##### Table of Contents









SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549


Form 10-K


|           |  |                                                                                             
|---------- |  | --------------------------------------------------------------------------------------------
|(Mark One) |  |                                                                                             
|þ          |  | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934    
|          
|           |  | For the fiscal year ended December 31, 2004                                                 
|          
|OR        
|          
|o          |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934
|          
|           |  | For the transition
    period           to           .                                      

Commission File Number: 1-10398


Giant Industries, Inc.


(Exact name of registrant as specified in its charter)


|                                                                   |  |                                         
|------------------------------------------------------------------ |  | ----------------------------------------
|DELAWARE                                                           |  | 86-0642718                              
|(State or other jurisdiction of
    incorporation or organization) |  | (I.R.S. Employer
    Identification No.)
|                                                                  
|23733 North Scottsdale Road,scottsdale,
    arizona                |  | 85255                                   
|(Address of principal executive offices)                           |  | (Zip Code)                              

Registrants telephone number, including area code:


(480) 585-8888


Securities registered pursuant to Section 12(b) of the
Act:


|                             |  |                                          
|---------------------------- |  | -----------------------------------------
|Title of Each Class          |  | Name of Each Exchange on Which Registered
|                             |  |                                          
|Common Stock, $.01 par value |  | New York Stock Exchange                  

Securities registered pursuant to Section 12(g) of the
Act:


None


þ o


o


þ o






DOCUMENTS INCORPORATED BY REFERENCE












---

TABLE OF CONTENTS



|             |                                                                                               |  |  |  |  |  |  | 
|------------ | --------------------------------------------------------------------------------------------- |  |  |  |  |  |  | 
|PART I      
|             | Items 1. and 2. Business and Properties.                                                     
|             | Item 3. Legal Proceedings.                                                                   
|             | Item 4. Submission of Matters to a Vote of Security Holders.                                 
|PART II     
|             | Item 5. Market For the Registrants Common Equity and Related Stockholder Matters            
|             | Item 6. Selected Financial Data.                                                             
|             | Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
|             | Item 7A. Quantitative and Qualitative Disclosures about Market Risk                          
|             | Item 8. Financial Statements and Supplementary Data                                          
|             | Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 
|             | Item 9A. Controls and Procedures                                                             
|PART III    
|             | Item 10. Directors and Executive Officers of the Registrant                                  
|             | Item 11. Executive Compensation                                                              
|             | Item 12. Security Ownership of Certain Beneficial Owners and Management                      
|             | Item 13. Certain Relationships and Related Transactions                                      
|             | Item 14. Principal Accountant Fees and Services                                              
|PART IV     
|             | Item 15. Exhibits, Financial Statement Schedules and Reports on Form 8-K                     
|SIGNATURES  
|EX-10.6     
|Exhibit 21.1
|Exhibit 23.1
|Exhibit 31.1
|Exhibit 31.2
|Exhibit 32.1
|Exhibit 32.2



---



##### Table of Contents






PART I







|                |                         
|--------------- | ------------------------
|Items 1. and 2. | Business and Properties.

General






| |   |                                                                                                                                                  
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------
| |  | on the East Coast  primarily in Virginia, Maryland,
    and North Carolina; and                                                                 
|
| |  | in the Southwest  primarily in New Mexico, Arizona,
    and Colorado, with a concentration in the Four Corners area
    where these states meet.







| |   |                      
| | - | ---------------------
| |  | our refining group;  
|
| |  | our retail group; and
|
| |  | Phoenix Fuel.        

Refining Group




Retail Group




Phoenix Fuel




Refining Group




| |                      
| | ---------------------
| | Our Yorktown Refinery



| |         
| | --------
| | Refining



2



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##### Table of Contents











|                                       |                                       |              |      |        |        |   |      |        |        |  
|-------------------------------------- | ------------------------------------- | ------------ | ---- | ------ | ------ | - | ---- | ------ | ------ | -
|                                       |                                       | Year Ended   |     
|                                       |                                       | December 31, |     
|                                       |                                       |              |     
|                                       |                                       | 2004         |      |        | 2003   |  
|                                       |                                       |              |      |        |        |  
|Feedstock throughput(1):               |                                       |              |      |        |        |   |      |       
|                                       | Crude oil                             |              |      | 52,000 |        |   |      | 51,600 |       
|                                       | Residual feedstocks and intermediates |              |      | 6,900  |        |   |      | 6,100  |       
|                                       |                                       |              |      |        |        |  
|                                       |                                       | Total        |      |        | 58,900 |   |      |        | 57,700 |  
|                                       |                                       |              |      |        |        |  
|Crude oil throughput (as a % of total) |                                       |              | 88   | %      |        |   | 89   | %     
|Rated crude oil capacity utilized      |                                       |              | 84   | %      |        |   | 83   | %     
|Refinery margin ($ per barrel)         |                                       | $            | 5.60 |        |        | $ | 4.07 |       
|Products(1):                           |                                       |              |      |        |        |   |      |       
|                                       | Gasoline                              |              |      | 29,600 |        |   |      | 30,200 |       
|                                       | Diesel fuel and No. 2 fuel oil        |              |      | 20,900 |        |   |      | 20,500 |       
|                                       | Other(2)                              |              |      | 8,400  |        |   |      | 7,000  |       
|                                       |                                       |              |      |        |        |  
|                                       |                                       | Total        |      |        | 58,900 |   |      |        | 57,700 |  
|                                       |                                       |              |      |        |        |  
|High-value products (as a % of total): |                                       |              |      |        |        |   |      |       
|                                       | Gasoline                              |              |      | 50     | %      |   |      | 52     | %     
|                                       | Diesel fuel and No. 2 fuel oil        |              |      | 35     | %      |   |      | 35     | %     
|                                       |                                       |              |      |        |        |  
|                                       |                                       | Total        |      |        | 85     | % |      |        | 87     | %
|                                       |                                       |              |      |        |        |  






|    |                                                                                                                                      
|--- | -------------------------------------------------------------------------------------------------------------------------------------
|(1) | Average barrels per day.                                                                                                             
|   
|(2) | Other products include LPGs, fuel oil, and anode grade
    petroleum coke, converted to a fuel oil equivalent number of
    barrels.



| |            
| | -----------
| | Turnarounds





3



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##### Table of Contents







| |                    
| | -------------------
| | Raw Material Supply





| |                  
| | -----------------
| | Statoil Agreement





| |   |                                                                                                                                        
| | - | ---------------------------------------------------------------------------------------------------------------------------------------
| |  | an event of force majeure, such as an act of God, wars or
    terrorism, occurs and continues for more than
    60 days; or            
|
| |  | an event of default occurs and is not cured within the
    applicable cure period, if any. Events of default include, among
    others:



| |   |                                                                                                                                                                                      
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | failure of a party to make payments when due;                                                                                                                                        
|
| |  | failure of a party to perform its obligations;                                                                                                                                       
|
| |  | bankruptcy or change of control of a party; and                                                                                                                                      
|
| |  | an event of default by us under our senior secured revolving
    credit agreement or our failure to make any payment in respect
    of indebtedness of more than $5 million when due.



| |               
| | --------------
| | Transportation





| |                           
| | --------------------------
| | Marketing and Distribution

The Yorktown Markets.


4



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##### Table of Contents





Dock System and Storage.




| |                       
| | ----------------------
| | Refined Product Sales.



|                                                                |  |      |    |   |      |  |    |  
|--------------------------------------------------------------- |  | ---- | -- | - | ---- |  | -- | -
|                                                                |  | 2004 |    |   | 2003 | 
|                                                                |  |      |    |   |      | 
|Direct sales to wholesalers, retailers and commercial customers |  |      | 71 | % |      |  | 81 | %
|Sales and exchanges with large oil companies                    |  |      | 29 | % |      |  | 19 | %



| |                                     
| | ------------------------------------
| | Our Ciniza and Bloomfield Refineries



| |         
| | --------
| | Refining







5



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##### Table of Contents





|                                       |                                    |                         |      |        |        |   |      |        |        |   |      |        |        |      |      |        |        |   |      |        |        |  
|-------------------------------------- | ---------------------------------- | ----------------------- | ---- | ------ | ------ | - | ---- | ------ | ------ | - | ---- | ------ | ------ | ---- | ---- | ------ | ------ | - | ---- | ------ | ------ | -
|                                       |                                    | Year Ended December 31, |     
|                                       |                                    |                         |     
|                                       |                                    | 2004                    |      |        | 2003   |   |      | 2002   |        |   | 2001 |        |        | 2000 |     
|                                       |                                    |                         |      |        |        |   |      |        |        |   |      |        |        |      |     
|Feedstock throughput:(1)               |                                    |                         |      |        |        |   |      |        |        |   |      |        |        |      |      |        |        |   |      |       
|                                       | Crude oil                          |                         |      | 22,900 |        |   |      | 24,500 |        |   |      | 26,600 |        |      |      | 27,000 |        |   |      | 29,600 |       
|                                       | Natural gas liquids and oxygenates |                         |      | 5,400  |        |   |      | 6,100  |        |   |      | 5,900  |        |      |      | 6,200  |        |   |      | 5,800  |       
|                                       |                                    |                         |      |        |        |   |      |        |        |   |      |        |        |      |     
|                                       |                                    | Total                   |      |        | 28,300 |   |      |        | 30,600 |   |      |        | 32,500 |      |      |        | 33,200 |   |      |        | 35,400 |  
|                                       |                                    |                         |      |        |        |   |      |        |        |   |      |        |        |      |     
|Crude oil throughput (as a % of total) |                                    |                         | 81   | %      |        |   | 80   | %      |        |   | 82   | %      |        |      | 82   | %      |        |   | 84   | %     
|Rated crude oil capacity utilized      |                                    |                         | 61   | %      |        |   | 67   | %      |        |   | 72   | %      |        |      | 73   | %      |        |   | 80   | %     
|Refinery margin ($ per barrel)         |                                    | $                       | 9.05 |        |        | $ | 8.81 |        |        | $ | 6.84 |        |        | $    | 9.69 |        |        | $ | 7.63 |       
|Products:(1)                           |                                    |                         |      |        |        |   |      |        |        |   |      |        |        |      |      |        |        |   |      |       
|                                       | Gasoline                           |                         |      | 18,600 |        |   |      | 20,900 |        |   |      | 21,400 |        |      |      | 21,400 |        |   |      | 22,500 |       
|                                       | Diesel fuel                        |                         |      | 6,600  |        |   |      | 6,900  |        |   |      | 8,100  |        |      |      | 8,600  |        |   |      | 9,600  |       
|                                       | Other                              |                         |      | 3,100  |        |   |      | 2,800  |        |   |      | 3,000  |        |      |      | 3,200  |        |   |      | 3,300  |       
|                                       |                                    |                         |      |        |        |   |      |        |        |   |      |        |        |      |     
|                                       |                                    | Total                   |      |        | 28,300 |   |      |        | 30,600 |   |      |        | 32,500 |      |      |        | 33,200 |   |      |        | 35,400 |  
|                                       |                                    |                         |      |        |        |   |      |        |        |   |      |        |        |      |     
|High Value Products (as a % of total): |                                    |                         |      |        |        |   |      |        |        |   |      |        |        |      |      |        |        |   |      |       
|                                       | Gasoline                           |                         |      | 67     | %      |   |      | 68     | %      |   |      | 66     | %      |      |      | 65     | %      |   |      | 64     | %     
|                                       | Diesel fuel                        |                         |      | 23     | %      |   |      | 23     | %      |   |      | 25     | %      |      |      | 26     | %      |   |      | 27     | %     
|                                       |                                    |                         |      |        |        |   |      |        |        |   |      |        |        |      |     
|                                       |                                    | Total                   |      |        | 90     | % |      |        | 91     | % |      |        | 91     | %    |      |        | 91     | % |      |        | 91     | %
|                                       |                                    |                         |      |        |        |   |      |        |        |   |      |        |        |      |     






|    |                         
|--- | ------------------------
|(1) | Average barrels per day.



| |            
| | -----------
| | Turnarounds





| |                    
| | -------------------
| | Raw Material Supply







6



---



##### Table of Contents











| |   |                                                                                                                                                                                   
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | evaluating potentially economic sources of crude oil produced
    outside the Four Corners area, including ways to reduce raw
    material transportation costs to our refineries;
|
| |  | evaluating ways to encourage further production in the Four
    Corners area;                                                                                                     
|
| |  | changes in operation/configuration of equipment at one or both
    refineries to further the integration of the two refineries, and
    reduce fixed costs; and                   
|
| |  | with sufficient further decline in raw material supply, the
    temporary, partial or permanent discontinuance of operations at
    one or both refineries.                       





| |               
| | --------------
| | Transportation





| |                           
| | --------------------------
| | Marketing and Distribution

The Four Corners Market.




7



---



##### Table of Contents



Terminal Operations.






| |                       
| | ----------------------
| | Refined Product Sales.



|                                                                |  |      |    |   |      |  |    |  
|--------------------------------------------------------------- |  | ---- | -- | - | ---- |  | -- | -
|                                                                |  | 2004 |    |   | 2003 | 
|                                                                |  |      |    |   |      | 
|Direct sales to wholesalers, retailers and commercial customers |  |      | 60 | % |      |  | 55 | %
|Direct sales to our own retail units                            |  |      | 19 | % |      |  | 26 | %
|Sales and exchanges with large oil companies                    |  |      | 18 | % |      |  | 18 | %
|Other                                                           |  |      | 3  | % |      |  | 1  | %

Retail Group










8



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##### Table of Contents





|             |                     |                                   |  |   |         |   |  |      |         |   |      |   |         |      |  |   |         |   |  |   |         |  
|------------ | ------------------- | --------------------------------- |  | - | ------- | - |  | ---- | ------- | - | ---- | - | ------- | ---- |  | - | ------- | - |  | - | ------- | -
|             |                     | Year Ended December 31,           | 
|             |                     |                                   | 
|             |                     | 2004                              |  |   | 2003    |   |  | 2002 |         |   | 2001 |   |         | 2000 | 
|             |                     |                                   |  |   |         |   |  |      |         |   |      |   |         |      | 
|Retail Group |                     |                                   |  |   |         |   |  |      |         |   |      |   |         |      |  |   |         |   |  |  
|             | Service Stations(1) |                                   |  |   |         |   |  |      |         |   |      |   |         |      |  |   |         |   |  |   |        
|             |                     | Fuel gallons sold (in thousands)  |  |   | 157,618 |   |  |      | 156,581 |   |      |   | 168,956 |      |  |   | 187,152 |   |  |   | 208,125 |  
|             |                     | Product margin ($/gallon)         |  | $ | 0.181   |   |  | $    | 0.197   |   |      | $ | 0.154   |      |  | $ | 0.170   |   |  | $ | 0.168   |  
|             |                     | Merchandise sold ($ in thousands) |  | $ | 134,296 |   |  | $    | 130,336 |   |      | $ | 135,767 |      |  | $ | 138,403 |   |  | $ | 131,825 |  
|             |                     | Merchandise margin                |  |   | 24      | % |  |      | 29      | % |      |   | 27      | %    |  |   | 28      | % |  |   | 28      | %
|             |                     | Number of outlets at year end     |  |   | 124     |   |  |      | 127     |   |      |   | 135     |      |  |   | 150     |   |  |   | 179     |  
|             | Travel Center(2)    |                                   |  |   |         |   |  |      |         |   |      |   |         |      |  |   |         |   |  |   |        
|             |                     | Fuel gallons sold (in thousands)  |  |   |        |   |  |      | 10,227  |   |      |   | 24,906  |      |  |   | 24,964  |   |  |   | 26,698  |  
|             |                     | Product margin ($/gallon)         |  |   |        |   |  | $    | 0.071   |   |      | $ | 0.094   |      |  | $ | 0.103   |   |  | $ | 0.104   |  
|             |                     | Merchandise sold ($ in thousands) |  |   |        |   |  | $    | 2,703   |   |      | $ | 6,103   |      |  | $ | 6,128   |   |  | $ | 6,719   |  
|             |                     | Merchandise margin                |  |   |        |   |  |      | 42      | % |      |   | 44      | %    |  |   | 44      | % |  |   | 46      | %
|             |                     | Number of outlets at year end     |  |   |        |   |  |      |        |   |      |   | 1       |      |  |   | 1       |   |  |   | 1       |  






|    |                                                                                
|--- | -------------------------------------------------------------------------------
|(1) | Includes continuing and discontinued operations.                               
|   
|(2) | 2003 figures are from January 1 to June 19 when the Travel
    Center was sold.

Phoenix Fuel






|                                    |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|----------------------------------- |  | ----------------------- | ------- | - | ---- | - | ------- | ---- |  | - | ------- | - |  | ---- | ------- | - |  | - | ------- | -
|                                    |  | Year Ended December 31, |        
|                                    |  |                         |        
|                                    |  | 2004                    |         |   | 2003 |   |         | 2002 |  |   | 2001    |   |  | 2000 |        
|                                    |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |        
|Phoenix Fuel                        |  |                         |         |   |      |   |         |      |  |   |         |   |  |      |         |   |  |   |         |  
|Fuel gallons sold (in thousands)(1) |  |                         | 473,009 |   |      |   | 429,198 |      |  |   | 376,711 |   |  |      | 394,158 |   |  |   | 424,290 |  
|Product margin ($/gallon)(2)        |  | $                       | 0.055   |   |      | $ | 0.053   |      |  | $ | 0.054   |   |  | $    | 0.050   |   |  | $ | 0.052   |  
|Lubricant sales ($ in thousands)    |  | $                       | 30,597  |   |      | $ | 24,475  |      |  | $ | 21,544  |   |  | $    | 22,347  |   |  | $ | 24,210  |  
|Lubricant margin                    |  |                         | 13      | % |      |   | 15      | %    |  |   | 17      | % |  |      | 17      | % |  |   | 16      | %






|    |                                                                                                                                                       
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Includes fuel gallons supplied to our retail group at no margin.                                                                                      
|   
|(2) | Calculated as fuel revenues, including delivery charges billed
    to the customer, less cost of fuel products sold, divided by
    fuel gallons sold.

9



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##### Table of Contents



Employees




|                           |  |           |       |  |           |  |     |       |  |  |       | 
|-------------------------- |  | --------- | ----- |  | --------- |  | --- | ----- |  |  | ----- | 
|                           |  | Full-Time |       |  | Part-Time |  |     | Total | 
|                           |  |           |       |  |           |  |     |       | 
|Refining group             |  |           | 621   |  |           |  | 5   |       |  |  | 626   | 
|Retail group               |  |           | 1,194 |  |           |  | 274 |       |  |  | 1,468 | 
|Phoenix Fuel               |  |           | 202   |  |           |  | 5   |       |  |  | 207   | 
|Corporate staff operations |  |           | 74    |  |           |  | 4   |       |  |  | 78    | 



Other Matters




| |                       
| | ----------------------
| | Competitive Conditions

We operate in a highly competitive industry.






| |   |                                                                                                               
| | - | --------------------------------------------------------------------------------------------------------------
| |  | the quality, quantity and delivered costs of crude oil, natural
    gas liquids and other refinery feedstocks;
|
| |  | refinery throughput and processing efficiencies;                                                              
|
| |  | refined product mix;                                                                                          
|
| |  | refined product selling prices;                                                                               
|
| |  | refinery processing costs per barrel;                                                                         
|
| |  | the cost of delivering refined products to markets; and                                                       
|
| |  | the ability of competitors to deliver refined products into our
    market areas by pipeline or other means.  





| |   |                                                                                                                                                         
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the level of customer service provided;                                                                                                                 
|
| |  | the location of our service stations;                                                                                                                   
|
| |  | product selling prices;                                                                                                                                 
|
| |  | product availability and cost, including prices being offered
    for refined products by major oil companies to our competitors
    in certain markets;
|
| |  | the appearance and cleanliness of our service stations;                                                                                                 
|
| |  | brand acceptance; and                                                                                                                                   
|
| |  | the development of gasoline retail operations by non-traditional
    marketers, such as supermarkets and club membership warehouses.                    

10



---



##### Table of Contents







| |   |                                                                                                                                                         
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | product availability and cost, including prices being offered
    for refined products by major oil companies to our competitors
    in certain markets;
|
| |  | the level of customer service provided;                                                                                                                 
|
| |  | product selling prices; and                                                                                                                             
|
| |  | business integration of new technology.                                                                                                                 



| |                                              
| | ---------------------------------------------
| | Competitors in the Yorktown Refinerys Market





| |                                                   
| | --------------------------------------------------
| | Competitors in the Four Corners Refineries Market





Regulatory, Environmental and Other Matters






| |   |                                                                                                       
| | - | ------------------------------------------------------------------------------------------------------
| |  | the discharge of pollutants into the soil, air and water;                                             
|
| |  | product specifications;                                                                               
|
| |  | the generation, treatment, storage, transportation and disposal
    of solid and hazardous wastes; and
|
| |  | employee health and safety.                                                                           



Motor Fuel Programs




11



---



##### Table of Contents



Low Sulfur Fuels.


Yorktown Compliance Extension.




Four Corners Compliance.




Reformulated Gasoline.


MTBE.


12



---



##### Table of Contents



Oxygenates.


MTBE Litigation




Alleged Regulatory Violations






Discharges, Releases and Cleanup Activities










| |   |                                                                                                                          
| | - | -------------------------------------------------------------------------------------------------------------------------
| |  | new accidental discharges;                                                                                               
|
| |  | we will fail to adequately remedy past discharges;                                                                       
|
| |  | governmental agencies may impose fines for past or future
    contamination;                                             
|
| |  | we may not receive anticipated levels of reimbursement from
    third parties, including state environmental agencies; or
|
| |  | third parties may assert claims against us for damages allegedly
    arising out of past or future contamination.        

13



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##### Table of Contents



Health and Safety




Changes in Environmental, Health and Safety Laws






| |   |                                                                                                                               
| | - | ------------------------------------------------------------------------------------------------------------------------------
| |  | the installation and operation of refinery equipment, pollution
    control systems and equipment we currently do not possess;
|
| |  | the acquisition or modification of permits applicable to our
    activities; and                                              
|
| |  | the initiation or modification of cleanup activities.                                                                         

Rights-Of-Way








Jet Fuel Claims




Yorktown Power Outage Claim




14



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##### Table of Contents





NYSE Matters




Additional Information


www.Giant.com www.sec.gov







|        |                   
|------- | ------------------
|Item 3. | Legal Proceedings.



15



---



##### Table of Contents








|        |                                                         
|------- | --------------------------------------------------------
|Item 4. | Submission of Matters to a Vote of Security
    Holders.



Executive Officers of the Registrant




|                  |  |     |    |  |          |                                                                                                  |                         |  |               | 
|----------------- |  | --- | -- |  | -------- | ------------------------------------------------------------------------------------------------ | ----------------------- |  | ------------- | 
|Name              |  | Age |    |  | Position |                                                                                                  | Executive Officer Since | 
|                  |  |     |    |  |          |                                                                                                  |                         | 
|Fred L. Holliger  |  |     | 57 |  |          | Chairman of the Board and Chief Executive Officer                                                |                         |  | October 1989  | 
|Morgan Gust       |  |     | 57 |  |          | President                                                                                        |                         |  | August 1990   | 
|Mark B. Cox       |  |     | 46 |  |          | Executive Vice President, Treasurer, Chief Financial Officer,
    and Assistant Secretary        |                         |  | February 1999 | 
|C. Leroy Crow     |  |     | 54 |  |          | Executive Vice President of our Refining Group Strategic
    Business Unit                       |                         |  | February 2000 | 
|Jack W. Keller    |  |     | 60 |  |          | President of Phoenix Fuel Strategic Business Unit                                                |                         |  | February 1999 | 
|Robert C. Sprouse |  |     | 48 |  |          | Executive Vice President of our Retail Group Strategic Business
    Unit                         |                         |  | April 2003    | 
|S. Leland Gould   |  |     | 48 |  |          | Executive Vice President, Governmental Affairs and Real Estate                                   |                         |  | March 2002    | 
|Kim H. Bullerdick |  |     | 51 |  |          | Senior Vice President, General Counsel, and Secretary                                            |                         |  | February 1999 | 
|Roger D. Sandeen  |  |     | 59 |  |          | Vice President, Chief Accounting Officer, Chief Information
    Officer, and Assistant Secretary |                         |  | July 2003     | 
|Gregory A. Barber |  |     | 47 |  |          | Vice President, Controller                                                                       |                         |  | April 2004    | 
|Natalie R. Dopp   |  |     | 33 |  |          | Vice President, Human Resources                                                                  |                         |  | April 2004    | 











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PART II







|        |                                                                              
|------- | -----------------------------------------------------------------------------
|Item 5. | Market For the Registrants Common Equity and Related
    Stockholder Matters



|                   |  |      |       |  |     |   |       | 
|------------------ |  | ---- | ----- |  | --- | - | ----- | 
|Quarter Ended      |  | High |       |  | Low |  
|                   |  |      |       |  |     |  
|December 31, 2004  |  | $    | 28.98 |  |     | $ | 22.00 | 
|September 30, 2004 |  |      | 27.25 |  |     |   | 20.29 | 
|June 30, 2004      |  |      | 22.16 |  |     |   | 15.37 | 
|March 31, 2004     |  |      | 25.44 |  |     |   | 11.71 | 
|December 31, 2003  |  | $    | 12.73 |  |     | $ | 7.10  | 
|September 30, 2003 |  |      | 8.10  |  |     |   | 5.57  | 
|June 30, 2003      |  |      | 6.32  |  |     |   | 4.42  | 
|March 31, 2003     |  |      | 5.50  |  |     |   | 2.85  | 

17



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|        |                         
|------- | ------------------------
|Item 6. | Selected Financial Data.



FINANCIAL AND OPERATING HIGHLIGHTS


|                                                       |                                            |                                                                  |         |           |      |   |         |           |      |   |         |           |       |      |         |         |        |   |         |           |      |  
|------------------------------------------------------ | ------------------------------------------ | ---------------------------------------------------------------- | ------- | --------- | ---- | - | ------- | --------- | ---- | - | ------- | --------- | ----- | ---- | ------- | ------- | ------ | - | ------- | --------- | ---- | -
|                                                       |                                            | Year Ended December 31,                                          |        
|                                                       |                                            |                                                                  |        
|                                                       |                                            | 2004                                                             |         |           | 2003 |   |         | 2002      |      |   | 2001    |           |       | 2000 |        
|                                                       |                                            |                                                                  |         |           |      |   |         |           |      |   |         |           |       |      |        
|                                                       |                                            | (In thousands, except percentages, per share and operating data) |        
|Financial Statement Data                               |                                            |                                                                  |         |           |      |   |         |           |      |   |         |           |       |      |         |         |        |   |         |          
|Continuing Operations:                                 |                                            |                                                                  |         |           |      |   |         |           |      |   |         |           |       |      |         |         |        |   |         |          
|                                                       | Net Revenues                               |                                                                  | $       | 2,512,005 |      |   | $       | 1,809,662 |      |   | $       | 1,252,026 |       |      | $       | 911,404 |        |   | $       | 1,008,841 |     
|                                                       | Operating Income                           |                                                                  |         | 78,405    |      |   |         | 63,775    |      |   |         | 19,959    |       |      |         | 45,374  |        |   |         | 35,286    |     
|                                                       | Earnings (Loss)                            |                                                                  |         | 16,292    |      |   |         | 12,312    |      |   |         | (11,520   | )     |      |         | 13,621  |        |   |         | 7,714     |     
|                                                       | Earnings (Loss) Per Common Share  Basic   |                                                                  | $       | 1.47      |      |   | $       | 1.41      |      |   | $       | (1.34     | )     |      | $       | 1.54    |        |   | $       | 0.84      |     
|                                                       | Earnings (Loss) Per Common Share  Diluted |                                                                  | $       | 1.43      |      |   | $       | 1.40      |      |   | $       | (1.34     | )     |      | $       | 1.53    |        |   | $       | 0.84      |     
|Discontinued Operations:                               |                                            |                                                                  |         |           |      |   |         |           |      |   |         |           |       |      |         |         |        |   |         |          
|                                                       | Net Revenues                               |                                                                  | $       | 853       |      |   | $       | 26,776    |      |   | $       | 61,036    |       |      | $       | 80,276  |        |   | $       | 90,519    |     
|                                                       | Operating (Loss) Income                    |                                                                  |         | (115      | )    |   |         | (631      | )    |   |         | 3,651     |       |      |         | (2,066  | )      |   |         | (709      | )   
|                                                       |                                            | (Loss) Earnings                                                  |         |           | (71  | ) |         |           | (389 | ) |         |           | 2,253 |      |         |         | (1,239 | ) |         |           | (425 | )
|                                                       | Earnings (Loss) Per Common Share  Basic   |                                                                  | $       | (0.01     | )    |   | $       | (0.05     | )    |   | $       | 0.26      |       |      | $       | (0.14   | )      |   | $       | (0.05     | )   
|                                                       | Earnings (Loss) Per Common Share  Diluted |                                                                  | $       | (0.01     | )    |   | $       | (0.05     | )    |   | $       | 0.26      |       |      | $       | (0.14   | )      |   | $       | (0.05     | )   
|Cumulative Effect of Change in Accounting Principle    |                                            |                                                                  |        |           |      | $ | (704    | )         |      |   |        |           |       |      |        |         |        |   |        |          
|                                                       | Loss Per Common Share  Basic              |                                                                  |         |          |      |   | $       | (0.08     | )    |   |         |          |       |      |         |        |        |   |         |          |     
|                                                       | Loss Per Common Share  Diluted            |                                                                  |         |          |      |   | $       | (0.08     | )    |   |         |          |       |      |         |        |        |   |         |          |     
|Weighted Average Common Shares Outstanding  Basic     |                                            |                                                                  | 11,105  |           |      |   | 8,732   |           |      |   | 8,566   |           |       |      | 8,871   |         |        |   | 9,214   |          
|Weighted Average Common Shares Outstanding  Diluted   |                                            |                                                                  | 11,358  |           |      |   | 8,830   |           |      |   | 8,566   |           |       |      | 8,885   |         |        |   | 9,223   |          
|Working Capital                                        |                                            | $                                                                | 103,172 |           |      | $ | 97,294  |           |      | $ | 91,333  |           |       | $    | 56,228  |         |        | $ | 53,537  |          
|Total Assets                                           |                                            |                                                                  | 702,406 |           |      |   | 699,654 |           |      |   | 702,286 |           |       |      | 507,174 |         |        |   | 528,565 |          
|Long-Term Debt(a)                                      |                                            |                                                                  | 292,759 |           |      |   | 355,601 |           |      |   | 398,069 |           |       |      | 256,749 |         |        |   | 258,009 |          
|Stockholders Equity                                   |                                            |                                                                  | 216,439 |           |      |   | 139,436 |           |      |   | 127,317 |           |       |      | 136,410 |         |        |   | 127,703 |          
|Long-Term Debt as a Percentage of Total Capitalization |                                            |                                                                  | 57.5    | %         |      |   | 71.8    | %         |      |   | 75.8    | %         |       |      | 65.3    | %       |        |   | 66.9    | %        
|Book Value Per Common Share Outstanding                |                                            | $                                                                | 17.55   |           |      | $ | 15.87   |           |      | $ | 14.85   |           |       | $    | 15.95   |         |        | $ | 14.27   |          
|Return on Average Stockholders Equity                 |                                            |                                                                  | 9.1     | %         |      |   | 8.4     | %         |      |   |        |           |       |      | 9.4     | %       |        |   | 5.6     | %        
|Operating Data                                         |                                            |                                                                  |         |           |      |   |         |           |      |   |         |           |       |      |         |         |        |   |         |          
|Refining Group:                                        |                                            |                                                                  |         |           |      |   |         |           |      |   |         |           |       |      |         |         |        |   |         |          
|Four Corners Operations:                               |                                            |                                                                  |         |           |      |   |         |           |      |   |         |           |       |      |         |         |        |   |         |          
|                                                       | Rated Crude Oil                            |                                                                  |         |           |      |   |         |           |      |   |         |           |       |      |         |         |        |   |         |           |     
|                                                       | Capacity Utilized                          |                                                                  |         | 61        | %    |   |         | 67        | %    |   |         | 72        | %     |      |         | 73      | %      |   |         | 80        | %   
|                                                       | Refinery Sourced Sales Barrels (Bbls/Day)  |                                                                  |         | 27,355    |      |   |         | 29,900    |      |   |         | 31,907    |       |      |         | 32,025  |        |   |         | 34,287    |     
|                                                       | Average Crude Oil Costs ($/Bbl)            |                                                                  | $       | 39.31     |      |   | $       | 29.32     |      |   | $       | 23.62     |       |      | $       | 25.00   |        |   | $       | 29.26     |     
|                                                       | Refinery Margin ($/Bbl)                    |                                                                  | $       | 8.97      |      |   | $       | 8.81      |      |   | $       | 6.84      |       |      | $       | 9.69    |        |   | $       | 7.63      |     



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|                        |                                           |                                    |   |         |         |   |   |         |         |   |      |         |         |      |   |         |         |   |   |         |         |  
|----------------------- | ----------------------------------------- | ---------------------------------- | - | ------- | ------- | - | - | ------- | ------- | - | ---- | ------- | ------- | ---- | - | ------- | ------- | - | - | ------- | ------- | -
|                        |                                           | Year Ended December 31,            |  
|                        |                                           |                                    |  
|                        |                                           | 2004                               |   |         | 2003    |   |   | 2002    |         |   | 2001 |         |         | 2000 |  
|                        |                                           |                                    |   |         |         |   |   |         |         |   |      |         |         |      |  
|                        |                                           | (In thousands, except percentages, |  
|                        |                                           | per share and operating data)      |  
|Yorktown Operations:(1) |                                           |                                    |   |         |         |   |   |         |         |   |      |         |         |      |   |         |         |   |   |        
|                        | Rated Crude Oil Capacity Utilized         |                                    |   | 84      | %       |   |   | 83      | %       |   |      | 86      | %       |      |   |         |         |   |   |         |        
|                        | Refinery Sourced Sales Barrels (Bbls/Day) |                                    |   | 60,999  |         |   |   | 58,931  |         |   |      | 58,771  |         |      |   |         |         |   |   |         |        
|                        | Average Crude Oil Costs ($/Bbl)           |                                    | $ | 37.39   |         |   | $ | 29.79   |         |   | $    | 27.01   |         |      |   |         |         |   |   |         |        
|                        | Refinery Margin ($/Bbl)                   |                                    | $ | 5.60    |         |   | $ | 4.07    |         |   | $    | 2.32    |         |      |   |         |         |   |   |         |        
|Retail Group:           |                                           |                                    |   |         |         |   |   |         |         |   |      |         |         |      |   |         |         |   |   |        
|                        | Service Stations: (Continuing Operations) |                                    |   |         |         |   |   |         |         |   |      |         |         |      |   |         |         |   |   |         |        
|                        |                                           | Fuel Gallons Sold (In Thousands)   |   |         | 157,175 |   |   |         | 149,197 |   |      |         | 148,983 |      |   |         | 156,667 |   |   |         | 171,620 |  
|                        |                                           | Product Margin ($/Gallon)          |   | $       | 0.181   |   |   | $       | 0.196   |   |      | $       | 0.155   |      |   | $       | 0.172   |   |   | $       | 0.169   |  
|                        |                                           | Merchandise Sold ($ In Thousands)  |   | $       | 134,076 |   |   | $       | 127,178 |   |      | $       | 123,806 |      |   | $       | 123,696 |   |   | $       | 118,596 |  
|                        |                                           | Merchandise Margin                 |   |         | 24      | % |   |         | 29      | % |      |         | 27      | %    |   |         | 28      | % |   |         | 28      | %
|                        | Operating Retail Outlets at Year End:     |                                    |   |         |         |   |   |         |         |   |      |         |         |      |   |         |         |   |   |         |        
|                        |                                           | Continuing Operations              |   |         | 124     |   |   |         | 124     |   |      |         | 124     |      |   |         | 124     |   |   |         | 152     |  
|                        |                                           | Discontinued Operations            |   |         |        |   |   |         | 3       |   |      |         | 12      |      |   |         | 26      |   |   |         | 27      |  
|                        | Travel Center:(2)                         |                                    |   |         |         |   |   |         |         |   |      |         |         |      |   |         |         |   |   |         |        
|                        |                                           | Fuel Gallons Sold (In Thousands)   |   |         |        |   |   |         | 10,227  |   |      |         | 24,906  |      |   |         | 24,964  |   |   |         | 26,698  |  
|                        |                                           | Product Margin ($/Gallon)          |   |         |        |   |   | $       | 0.071   |   |      | $       | 0.094   |      |   | $       | 0.103   |   |   | $       | 0.104   |  
|                        |                                           | Merchandise Sold ($ In Thousands)  |   |         |        |   |   | $       | 2,703   |   |      | $       | 6,103   |      |   | $       | 6,128   |   |   | $       | 6,719   |  
|                        |                                           | Merchandise Margin                 |   |         |        |   |   |         | 42      | % |      |         | 44      | %    |   |         | 44      | % |   |         | 46      | %
|                        |                                           | Number of Outlets at Year End      |   |         |        |   |   |         |        |   |      |         | 1       |      |   |         | 1       |   |   |         | 1       |  
|Phoenix Fuel:           |                                           |                                    |   |         |         |   |   |         |         |   |      |         |         |      |   |         |         |   |   |        
|                        | Fuel Gallons Sold (In Thousands)          |                                    |   | 473,009 |         |   |   | 429,198 |         |   |      | 376,711 |         |      |   | 394,158 |         |   |   | 424,290 |        
|                        | Product Margin ($/Gallon)                 |                                    | $ | 0.055   |         |   | $ | 0.053   |         |   | $    | 0.054   |         |      | $ | 0.050   |         |   | $ | 0.052   |        
|                        | Lubricant Sales ($ In Thousands)          |                                    | $ | 30,597  |         |   | $ | 24,475  |         |   | $    | 21,544  |         |      | $ | 22,347  |         |   | $ | 24,210  |        
|                        | Lubricant Margin                          |                                    |   | 13      | %       |   |   | 15      | %       |   |      | 17      | %       |      |   | 17      | %       |   |   | 16      | %      






|    |                          
|--- | -------------------------
|(1) | Acquired on May 14, 2002.
|   
|(2) | Sold June 19, 2003.      






|        |                                                                                          
|------- | -----------------------------------------------------------------------------------------
|Item 7. | Managements Discussion and Analysis of Financial
    Condition and Results of Operations

Company Overview








| |   |                                                                                                                     
| | - | --------------------------------------------------------------------------------------------------------------------
| |  | increasing margins through management of inventories and taking
    advantage of sales and purchasing opportunities;
|
| |  | minimizing or reducing operating expenses and capital
    expenditures;                                             
|
| |  | increasing the available crude oil supply for our Four Corners
    refineries;                                      

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| |   |                                                                                                                                                                                                                                          
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | cost effectively complying with current environmental
    regulations as they apply to our refineries, including future
    clean air standards;                                                                                         
|
| |  | improving our overall financial health and flexibility by, among
    other things, reducing our debt and overall costs of capital,
    including our interest and financing costs, and maximizing our
    return on capital employed; and
|
| |  | evaluating opportunities for internal growth and growth by
    acquisition.                                                                                                                                                              

Critical Accounting Policies








| |   |                                                                                                                
| | - | ---------------------------------------------------------------------------------------------------------------
| |  | accounting for contingencies, including environmental
    remediation and litigation liabilities (see Note 17);
|
| |  | assessing the possible impairment of long-lived assets (see
    Notes 4 and 5);                                
|
| |  | accounting for asset retirement obligations (see Note 7);                                                      
|
| |  | accounting for our pension and post-retirement benefit plans
    (see Note 13); and                            
|
| |  | accounting for inventories (see Note 2).                                                                       

Contingencies, Including Environmental Remediation and
Litigation Liabilities






| |   |                                                                                             
| | - | --------------------------------------------------------------------------------------------
| |  | past operations, including liabilities arising out of changes in
    environmental laws; and
|
| |  | liabilities assumed in connection with acquired assets.                                     



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Impairment of Long-Lived Assets




Asset Retirement Obligations






| |   |                                                        
| | - | -------------------------------------------------------
| |  | some of our solid waste management facilities;         
|
| |  | some of our crude pipeline right-of-way agreements; and
|
| |  | some of our underground and above-ground storage tanks.





| |   |                                                                                                                                                                                                                               
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | settlement date occurs at the end of the economic useful
    life; and                                                                                                                                                        
|
| |  | settlement prices are estimated using consultant proposals and
    third-party contractor invoices for substantially equivalent
    work and a market risk premium to cover uncertainties and
    unforeseeable circumstances.





Pension and Post-Retirement Plans






| |   |                                             
| | - | --------------------------------------------
| |  | discount rate;                              
|
| |  | long-term rate of return on plan assets; and
|
| |  | healthcare cost trend rates.                

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|                                                  |             |                     |   |            |                   |  |   |                 |   |  |   |          |  
|------------------------------------------------- | ----------- | ------------------- | - | ---------- | ----------------- |  | - | --------------- | - |  | - | -------- | -
|                                                  |             | Increase/(Decrease) |  
|                                                  |             |                     |  
|                                                  |             | Impact on Projected |   |            | Impact on         |  |   | Impact on       |  
|Actuarial Assumption(a)                           |             | Benefit Obligation  |   |            | Pension Liability |  |   | Pension Expense |  
|                                                  |             |                     |   |            |                   |  |   |                 |  
|Discount rate:                                    |             |                     |   |            |                   |  |   |                 |   |  |   |         
|                                                  | Increase 1% |                     | $ | (2,394,000 | )                 |  | $ | (455,000        | ) |  | $ | (455,000 | )
|                                                  | Decrease 1% |                     |   | 2,211,000  |                   |  |   | 269,000         |   |  |   | 269,000  |  
|Expected long-term rate of return on plan assets: |             |                     |   |            |                   |  |   |                 |   |  |   |         
|                                                  | Increase 1% |                     |   |           |                   |  |   | (14,000         | ) |  |   | (14,000  | )
|                                                  | Decrease 1% |                     |   |           |                   |  |   | 14,000          |   |  |   | 14,000   |  






|    |  |                                                                                             
|--- |  | --------------------------------------------------------------------------------------------
|(a) |  | Each fluctuation assumes that the other components of the
    calculation are held constant.



|                                |             |                     |   |          |                 |  |   |         |  
|------------------------------- | ----------- | ------------------- | - | -------- | --------------- |  | - | ------- | -
|                                |             | Increase/(Decrease) |  
|                                |             |                     |  
|                                |             | Impact on           |   |          | Impact on       | 
|                                |             | Accumulated         |   |          | Other           | 
|                                |             | Postretirement      |   |          | Postretirement  | 
|Actuarial Assumption(a)         |             | Benefit Obligation  |   |          | Benefit Expense | 
|                                |             |                     |   |          |                 | 
|Discount rate:                  |             |                     |   |          |                 |  |   |        
|                                | Increase 1% |                     | $ | (516,000 | )               |  | $ | (51,000 | )
|                                | Decrease 1% |                     |   | 641,000  |                 |  |   | 83,000  |  
|Health care cost trend rate(b): |             |                     |   |          |                 |  |   |        
|                                | Increase 1% |                     |   | 65,000   |                 |  |   | 11,000  |  
|                                | Decrease 1% |                     |   | (64,000  | )               |  |   | (11,000 | )






|    |  |                                                                                             
|--- |  | --------------------------------------------------------------------------------------------
|(a) |  | Each fluctuation assumes that the other components of the
    calculation are held constant.
|   
|(b) |  | This assumes a 1% change in the initial and ultimate health care
    cost trend rate.       

Inventories




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Results of Operations






|                               |                                       |                                      |   |         |        |  |   |         |        |  |   |         |        | 
|------------------------------ | ------------------------------------- | ------------------------------------ | - | ------- | ------ |  | - | ------- | ------ |  | - | ------- | ------ | 
|                               |                                       | Year Ended December 31,              |  
|                               |                                       |                                      |  
|                               |                                       | 2004                                 |   |         | 2003   |  |   | 2002    |       
|                               |                                       |                                      |   |         |        |  |   |         |       
|Refining Group Operating Data: |                                       |                                      |   |         |        |  |   |         |        |  |   |        
|                               | Four Corners Operations:              |                                      |   |         |        |  |   |         |        |  |   |         |       
|                               |                                       | Crude Oil/ NGL Throughput (BPD)      |   |         | 28,281 |  |   |         | 30,552 |  |   |         | 32,535 | 
|                               |                                       | Refinery Sourced Sales Barrels (BPD) |   |         | 27,355 |  |   |         | 29,900 |  |   |         | 31,907 | 
|                               |                                       | Average Crude Oil Costs ($/Bbl)      |   | $       | 39.31  |  |   | $       | 29.32  |  |   | $       | 23.62  | 
|                               |                                       | Refining Margins ($/Bbl)             |   | $       | 8.97   |  |   | $       | 8.81   |  |   | $       | 6.84   | 
|                               | Yorktown Operations:                  |                                      |   |         |        |  |   |         |        |  |   |         |       
|                               |                                       | Crude Oil Throughput (BPD)           |   |         | 58,913 |  |   |         | 57,672 |  |   |         | 57,297 | 
|                               |                                       | Refinery Sourced Sales Barrels (BPD) |   |         | 60,999 |  |   |         | 58,931 |  |   |         | 58,771 | 
|                               |                                       | Average Crude Oil Costs ($/Bbl)      |   | $       | 37.39  |  |   | $       | 29.79  |  |   | $       | 27.01  | 
|                               |                                       | Refining Margins ($/Bbl)             |   | $       | 5.60   |  |   | $       | 4.07   |  |   | $       | 2.32   | 
|Retail Group Operating Data:   |                                       |                                      |   |         |        |  |   |         |        |  |   |        
|(Continuing operations only)   |                                       |                                      |   |         |        |  |   |         |        |  |   |        
|                               | Fuel Gallons Sold (000s)             |                                      |   | 157,175 |        |  |   | 149,197 |        |  |   | 148,983 |       
|                               | Fuel Margins ($/gal)                  |                                      | $ | 0.181   |        |  | $ | 0.196   |        |  | $ | 0.155   |       
|                               | Merchandise Sales ($ in 000s)        |                                      | $ | 134,076 |        |  | $ | 127,178 |        |  | $ | 123,806 |       
|                               | Merchandise Margins                   |                                      |   | 24      | %      |  |   | 29      | %      |  |   | 27      | %     
|                               | Operating Retail Outlets at Year End: |                                      |   | 124     |        |  |   | 124     |        |  |   | 124     |       
|Phoenix Fuel Operating Data:   |                                       |                                      |   |         |        |  |   |         |        |  |   |        
|                               | Fuel Gallons Sold (000s)             |                                      |   | 473,009 |        |  |   | 429,198 |        |  |   | 376,711 |       
|                               | Fuel Margins ($/gal)                  |                                      | $ | 0.055   |        |  | $ | 0.053   |        |  | $ | 0.054   |       
|                               | Lubricant Sales ($ in 000s)          |                                      | $ | 30,957  |        |  | $ | 24,475  |        |  | $ | 21,544  |       
|                               | Lubricant Margins                     |                                      |   | 13      | %      |  |   | 15      | %      |  |   | 17      | %     





| |   |                                                                                                   
| | - | --------------------------------------------------------------------------------------------------
| |  | stronger combined net refining margins for our refineries in
    2004, due to, among other things:



| |   |                                                                                       
| | - | --------------------------------------------------------------------------------------
| |  | increased finished product demand;                                                    
|
| |  | increased sales in our Tier 1 markets;                                                
|
| |  | reduced imports of foreign gasoline, due to a reduction in
    gasoline sulfur limits;
|
| |  | elimination of MTBE in Connecticut, New York, and
    California; and                 
|
| |  | tight finished product supply in certain of our market areas.                         

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| |   |                                                                                                                                                                                                                                                                                          
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the processing of lower priced acidic crude oils at our Yorktown
    refinery, including crude oil purchased under our supply
    agreement with Statoil that began deliveries in late February
    2004;                                                                                
|
| |  | a processing unit turnaround at our Yorktown refinery in 2003,
    which resulted in the refinery being out of operation from
    March 21, 2003 to April 16, 2003;                                                                                                                      
|
| |  | an unplanned shutdown of all processing units at the Yorktown
    refinery from the end of April 2003 to the middle of May 2003 as
    a result of a breaker failure at the electric generation plant,
    which is owned by an unrelated power provider, that supplies the
    refinery;
|
| |  | continued reduced production at our Four Corners refineries
    because of lower crude oil receipts due to reduced supply
    availability;                                                                                                                                              
|
| |  | stronger finished product sales volumes and margins for our
    Phoenix Fuel operations in 2004, due to, among other things:                                                                                                                                                             



| |   |                                                       
| | - | ------------------------------------------------------
| |  | increased finished product demand;                    
|
| |  | an expanded customer base; and                        
|
| |  | tight finished product supplies in our Phoenix market.



| |   |                                                                                                                                                                                                                                                                                                                     
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the shutdown of the alkylation unit at our Ciniza refinery as a
    result of the fire that occurred on April 8, 2004, which
    resulted in the alkylation unit being out of operation from
    April 8, 2004 to September 1, 2004;                                                                                
|
| |  | a scheduled turnaround, which started early as a result of the
    fire discussed above, at the Ciniza refinery, which resulted in
    the refinery being out of operation from April 8, 2004 to
    May 9, 2004 (except the alkylation unit, which was not
    repaired and restarted until September 1, 2004); and
|
| |  | lower throughput volumes at the Yorktown refinery due to the
    delayed completion of refinery upgrades to process additional
    higher-acid crude oil and unrelated operating problems with two
    units that were resolved by early January, 2005.                                                             

Comparison of the Years Ended December 31, 2004 and
December 31, 2003




| |                                                                   
| | ------------------------------------------------------------------
| | Earnings (Loss) From Continuing Operations Before Income
    Taxes





| |   |                                                                                                                                                    
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------
| |  | an increase in operating earnings before corporate allocations
    from our refinery operations of $19,695,000 primarily due to
    higher margins;
|
| |  | a 10% increase in fuel volumes sold by Phoenix Fuel and slightly
    higher margins;                                                               
|
| |  | a 16% decrease in interest expense due to our refinancing
    transactions in 2004; and,                                                           
|
| |  | a $3,907,000 gain from an insurance settlement due to a fire
    incident.                                                                         





| |   |                                                                                                                                                                                                                                                                               
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | a 7% increase in operating expenses;                                                                                                                                                                                                                                          
|
| |  | a 7% decline in fuel volumes sold from our Four Corners
    refineries;                                                                                                                                                                                                       
|
| |  | $10,564,000 of costs incurred and write-offs of $4,885,000 of
    previously deferred financing costs and original issue discount
    that were related to early extinguishment of part of our
    long-term debt as a result of the refinancing transactions in
    2004; and
|
| |  | a 17% decline in our retail groups merchandise margin due
    to, among other things, an inventory reduction and lower rebates.                                                                                                                                              

25



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##### Table of Contents





| |                  
| | -----------------
| | Yorktown Refinery













| |   |                                                                                                                                                                                                                                                  
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | higher maintenance costs primarily related to tank inspections
    and repairs and coker unit repairs;                                                                                                                                           
|
| |  | higher operating costs due to higher volumes, higher electrical
    costs and higher purchased costs of natural gas;                                                                                                                             
|
| |  | higher chemical and catalyst costs, primarily related to higher
    cost catalyst required to meet more stringent sulfur reduction
    requirements; and                                                                                         
|
| |  | higher payroll and related costs, due in part to the
    capitalization of certain wages in the first half of 2003
    (primarily due to turnaround activity) and increased group
    medical insurance premiums and workers compensation costs.







| |                        
| | -----------------------
| | Four Corners Refineries











26



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##### Table of Contents







| |             
| | ------------
| | Retail Group













| |             
| | ------------
| | Phoenix Fuel













| |                                                                                   
| | ----------------------------------------------------------------------------------
| | Selling, General and Administrative Expenses (SG&A)
    from Continuing Operations





| |   |                                                                                                
| | - | -----------------------------------------------------------------------------------------------
| |  | higher management incentive bonuses associated with improved
    company financial performance;
|
| |  | higher litigation reserves; and                                                                
|
| |  | increased costs associated with complying with the
    Sarbanes-Oxley Act.                     





| |                                            
| | -------------------------------------------
| | Interest Expense from Continuing Operations



27



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| |                                                                                     
| | ------------------------------------------------------------------------------------
| | Net (Gain) Loss on the Disposal/ Write-Down of Assets from
    Continuing Operations







| |                                        
| | ---------------------------------------
| | Income Taxes from Continuing Operations



Discontinued Operations




Outlook




Comparison of the Years Ended December 31, 2003 and
December 31, 2002




| |                                                                   
| | ------------------------------------------------------------------
| | Earnings (Loss) From Continuing Operations Before Income
    Taxes





| |   |                                                                                                              
| | - | -------------------------------------------------------------------------------------------------------------
| |  | an increase in operating earnings before corporate allocations
    from our Yorktown refinery of $28,427,000;
|
| |  | a 29% increase in our Four Corners refineries refining
    margin per barrel;                               
|
| |  | a 26% increase in our retail group fuel margin per
    gallon; and                                           
|
| |  | a 7% increase in our retail group merchandise margin percentage.                                             





| |   |                                                                                            
| | - | -------------------------------------------------------------------------------------------
| |  | a 20% increase in our selling, general and administrative
    expenses;                    
|
| |  | a 12% increase in operating expenses for our operations other
    than Yorktown;           
|
| |  | a 6% decline in our Four Corners refineries fuel volumes
    sold;                        
|
| |  | a 7% increase in interest expense; and                                                     
|
| |  | net losses on the disposal/write-down of assets in 2003 compared
    to a net gain in 2002.

28



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| |                  
| | -----------------
| | Yorktown Refinery











| |   |                                                                                                                   
| | - | ------------------------------------------------------------------------------------------------------------------
| |  | cold weather in the Northeast in the early part of the year,
    resulting in an increased demand for heating oil;
|
| |  | an extended summer driving season, resulting in part from warmer
    than normal east coast temperatures; and     
|
| |  | reduced foreign gasoline imports, due in part to the phase in of
    stricter gasoline specifications.            





| |                        
| | -----------------------
| | Four Corners Refineries











| |   |                                                                                                                                              
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------
| |  | refinery supply problems on the west coast;                                                                                                  
|
| |  | refinery turnarounds by our competitors; and                                                                                                 
|
| |  | the Kinder-Morgan Pipeline rupture in August 2003, which
    affected fuel supplies in the Phoenix, Arizona and Southern
    Arizona markets.





29



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| |             
| | ------------
| | Retail Group











| |   |                                                                                                                                                 
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the Kinder-Morgan pipeline rupture, which affected the supply of
    finished products in the Phoenix, Arizona and Southern Arizona
    markets;
|
| |  | more effectively managing our fuel pricing; and                                                                                                 
|
| |  | more favorable market conditions.                                                                                                               





| |   |                                          
| | - | -----------------------------------------
| |  | more favorable market conditions;        
|
| |  | implementation of marketing programs; and
|
| |  | favorable supplier arrangements.         







| |             
| | ------------
| | Phoenix Fuel













| |                                                                                   
| | ----------------------------------------------------------------------------------
| | Selling, General and Administrative Expenses (SG&A)
    from Continuing Operations



30



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##### Table of Contents







| |   |                                                                                       
| | - | --------------------------------------------------------------------------------------
| |  | accruals for management incentive bonuses;                                            
|
| |  | increased costs for our self-insured health plan, due to higher
    claims experience;
|
| |  | higher workers compensation costs;                                                    
|
| |  | increased letter of credit fees; and                                                  
|
| |  | higher officers and directors insurance premiums.                                     





| |                                            
| | -------------------------------------------
| | Interest Expense from Continuing Operations

3 4




| |                                                                                     
| | ------------------------------------------------------------------------------------
| | Net (Gain) Loss on the Disposal/ Write-Down of Assets from
    Continuing Operations





| |                                        
| | ---------------------------------------
| | Income Taxes from Continuing Operations



Discontinued Operations




Liquidity and Capital Resources




| |                  
| | -----------------
| | Capital Structure







| |   |                                                                                
| | - | -------------------------------------------------------------------------------
| |  | $150,000,000 before discount, of 8% Senior Subordinated
    Notes due 2014; and
|
| |  | $148,828,000 before discount, of 11% Senior Subordinated
    Notes due 2012.   

31



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##### Table of Contents







| |   |                                                               
| | - | --------------------------------------------------------------
| |  | $150,000,000 of 9% Senior Subordinated Notes due
    2007; and
|
| |  | $200,000,000 of 11% Senior Subordinated Notes due 2012.       





| |   |                                                                                           
| | - | ------------------------------------------------------------------------------------------
| |  | a tender offer and consent solicitation for our 9% senior
    subordinated notes due 2007;
|
| |  | a redemption of the 9% notes not tendered in the tender
    offer;                        
|
| |  | the sale of $150,000,000 of 8% senior subordinated notes
    due 2014;                    
|
| |  | the sale of 3,283,300 shares of our common stock;                                         
|
| |  | the prepayment of the outstanding balance on our mortgage loan
    facility; and          
|
| |  | the renegotiation of our revolving credit facility.                                       













32



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| |   |                                                                                                                                                                                                                                
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | limit our ability to use cash flow, or obtain additional
    financing, for future working capital needs, capital
    expenditures, acquisitions or other general corporate purposes;                                          
|
| |  | restrict our ability to pay dividends or purchase shares of our
    common stock;                                                                                                                                              
|
| |  | require a substantial portion of our cash flow from operations
    to make interest payments;                                                                                                                                  
|
| |  | limit our flexibility to plan for, or react to, changes in
    business and industry conditions;                                                                                                                               
|
| |  | place us at a competitive disadvantage compared to less
    leveraged competitors; and                                                                                                                                         
|
| |  | increase our vulnerability to the impact of adverse economic and
    industry conditions and, to the extent of our outstanding debt
    under our floating rate debt facilities, the impact of increases
    in interest rates.





| |   |                                                               
| | - | --------------------------------------------------------------
| |  | generate sufficient cash flow from operations;                
|
| |  | borrow sufficient funds to service our debt; or               
|
| |  | meet our working capital and capital expenditure requirements,



| |                                                                                                                            
| | ---------------------------------------------------------------------------------------------------------------------------
| | then, due to borrowing base restrictions, increased letter of
    credit requirements, or otherwise, we may be required to:



| |   |                                                    
| | - | ---------------------------------------------------
| |  | sell additional assets;                            
|
| |  | reduce capital expenditures;                       
|
| |  | refinance all or a portion of our existing debt; or
|
| |  | obtain additional financing.                       





33



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##### Table of Contents





| |                          
| | -------------------------
| | Cash Flow From Operations





| |   |                                                                                                                                   
| | - | ----------------------------------------------------------------------------------------------------------------------------------
| |  | the supply of and demand for crude oil, gasoline and other
    refined products;                                                  
|
| |  | changes in the U.S. economy;                                                                                                      
|
| |  | changes in the level of foreign and domestic production of crude
    oil and refined products;                                    
|
| |  | worldwide political conditions;                                                                                                   
|
| |  | the extent of government laws; and                                                                                                
|
| |  | local factors, including market conditions, pipeline capacity,
    and the level of operations of other refineries in our markets.











34



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| |                
| | ---------------
| | Working Capital





| |                                   
| | ----------------------------------
| | Capital Expenditures and Resources









3 4




35



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##### Table of Contents





|                              |  |                |            |  |                |   |            |                |  |   |                 |  |  |   |             | 
|----------------------------- |  | -------------- | ---------- |  | -------------- | - | ---------- | -------------- |  | - | --------------- |  |  | - | ----------- | 
|                              |  | 2002 Reduction |            |  | 2003 Reduction |   |            | 2004 Reduction |  |   | Total Reduction | 
|                              |  |                |            |  |                |   |            |                |  |   |                 | 
|Revolving credit facility     |  | $              | 35,000,000 |  |                | $ | 25,000,000 |                |  | $ |                |  |  | $ | 60,000,000  | 
|Term loan                     |  |                | 7,778,000  |  |                |   | 10,222,000 |                |  |   | 22,000,000      |  |  |   | 40,000,000  | 
|11% senior subordinated notes |  |                |           |  |                |   |           |                |  |   | 51,171,000      |  |  |   | 51,171,000  | 
|Capital lease obligations     |  |                |           |  |                |   | 6,703,000  |                |  |   |                |  |  |   | 6,703,000   | 
|                              |  |                |            |  |                |   |            |                |  |   |                 | 
|Total                         |  | $              | 42,778,000 |  |                | $ | 41,925,000 |                |  | $ | 73,171,000      |  |  | $ | 157,874,000 | 
|                              |  |                |            |  |                |   |            |                |  |   |                 | 















| |   |                   
| | - | ------------------
| |  | 2004  $8,060,000;

36



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##### Table of Contents





| |   |                       
| | - | ----------------------
| |  | 2003  $2,468,000; and
|
| |  | 2002  $565,000.      









| |                      
| | ---------------------
| | Long-Term Commitments



|                             |                                  |                |           |               |           |   |         |         |         |   |         |         |         |      |         |         |         |   |         |         |         |   |        |        |        |   |         |        |         | 
|---------------------------- | -------------------------------- | -------------- | --------- | ------------- | --------- | - | ------- | ------- | ------- | - | ------- | ------- | ------- | ---- | ------- | ------- | ------- | - | ------- | ------- | ------- | - | ------ | ------ | ------ | - | ------- | ------ | ------- | 
|                             |                                  | Payments Due   |          
|                             |                                  |                |          
|                             |                                  |                |           | All Remaining |          
|                             |                                  | Total          |           |               | 2005      |   |         | 2006    |         |   | 2007    |         |         | 2008 |         |         | 2009    |   |         | Years   |        
|                             |                                  |                |           |               |           |   |         |         |         |   |         |         |         |      |         |         |         |   |         |         |        
|                             |                                  | (In thousands) |          
|Long-Term Debt*              |                                  | $              | 298,829   |               |           | $ |        |         |         | $ |        |         |         | $    |        |         |         | $ |        |         |         | $ |       |        |        | $ | 298,829 |       
|Operating Leases             |                                  |                | 39,004    |               |           |   | 6,209   |         |         |   | 5,294   |         |         |      | 4,469   |         |         |   | 3,662   |         |         |   | 3,212  |        |        |   | 16,158  |       
|Purchase Obligations:        |                                  |                |           |               |           |   |         |         |         |   |         |         |         |      |         |         |         |   |         |         |         |   |        |        |        |   |         |       
|                             | Raw material purchases           |                |           | 2,791,725     |           |   |         | 875,841 |         |   |         | 629,059 |         |      |         | 622,519 |         |   |         | 618,754 |         |   |        | 45,552 |        |   |         |       |        
|                             | Finished product purchases       |                |           |              |           |   |         |        |         |   |         |        |         |      |         |        |         |   |         |        |         |   |        |       |        |   |         |       |        
|                             | Services                         |                |           | 9,765         |           |   |         | 9751    |         |   |         | 2       |         |      |         | 2       |         |   |         | 2       |         |   |        | 2      |        |   |         | 6      |        
|                             |                                  |                |           |               |           |   |         |         |         |   |         |         |         |      |         |         |         |   |         |         |        
|                             |                                  | Total          |           |               | 3,139,323 |   |         |         | 891,801 |   |         |         | 634,355 |      |         |         | 626,990 |   |         |         | 622,418 |   |        |        | 48,766 |   |         |        | 314,993 | 
|                             |                                  |                |           |               |           |   |         |         |         |   |         |         |         |      |         |         |         |   |         |         |        
|Other Long-Term Obligations: |                                  |                |           |               |           |   |         |         |         |   |         |         |         |      |         |         |         |   |         |         |         |   |        |        |        |   |         |       
|                             | Aggregate environmental reserves |                |           | 6,156         |           |   |         | 2,804   |         |   |         | 1,413   |         |      |         | 849     |         |   |         | 41      |         |   |        | 38     |        |   |         | 1,011  |        
|                             | Pension obligations              |                |           | 2,000         |           |   |         | 2,000   |         |   |         |        |         |      |         |        |         |   |         |        |         |   |        |       |        |   |         |       |        
|                             | Aggregate litigation reserves    |                |           | 525           |           |   |         | 525     |         |   |         |        |         |      |         |        |         |   |         |        |         |   |        |       |        |   |         |       |        
|                             | Interest obligations             |                |           | 236,784       |           |   |         | 28,371  |         |   |         | 28,371  |         |      |         | 28,371  |         |   |         | 28,371  |         |   |        | 28,371 |        |   |         | 94,929 |        
|                             |                                  |                |           |               |           |   |         |         |         |   |         |         |         |      |         |         |         |   |         |         |        
|                             |                                  | Total          |           |               | 245,465   |   |         |         | 33,700  |   |         |         | 29,784  |      |         |         | 29,220  |   |         |         | 28,412  |   |        |        | 28,409 |   |         |        | 95,940  | 
|                             |                                  |                |           |               |           |   |         |         |         |   |         |         |         |      |         |         |         |   |         |         |        
|Total Obligations            |                                  | $              | 3,384,788 |               |           | $ | 925,501 |         |         | $ | 664,139 |         |         | $    | 656,210 |         |         | $ | 650,830 |         |         | $ | 77,175 |        |        | $ | 410,933 |       
|                             |                                  |                |           |               |           |   |         |         |         |   |         |         |         |      |         |         |         |   |         |         |        






|  |                                   
|- | ----------------------------------
|* | Excluding original issue discount.









37



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##### Table of Contents







|                                                      |  |                                 |         |               |      |   |        |                |  |      |   |      |  |   |      |  |       |   |         |  |  |   |   |  |  |   |   | 
|----------------------------------------------------- |  | ------------------------------- | ------- | ------------- | ---- | - | ------ | -------------- |  | ---- | - | ---- |  | - | ---- |  | ----- | - | ------- |  |  | - | - |  |  | - | - | 
|                                                      |  | Amount of Commitment Expiration
|                                                      |  |                                
|                                                      |  |                                 |         | All Remaining
|Other Commercial Commitments                          |  | Total                           |         |               | 2004 |   |        | 2005           |  | 2006 |   | 2007 |  |   | 2008 |  | Years
|                                                      |  |                                 |         |               |      |   |        |                |  |      |   |      |  |   |      |  |      
|                                                      |  |                                 |         |               |      |   |        | (In thousands) |  |      |   |      | 
|Line of Credit* (including Standby Letters of Credit) |  | $                               | 100,000 |               |      | $ |       |                |  | $    |  |      |  | $ |     |  |       | $ | 100,000 |  |  | $ |  |  |  | $ |  | 
|Standby Letters of Credit                             |  |                                 | 12,068  |               |      |   | 12,068 |                |  |      |  |      |  |   |     |  |       |   |        |  |  |   |  |  |  |   |  | 






|  |                                                                                                                                                                                                  
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|* | Standby letters of credit reduce the availability of funds for
    direct borrowings under the line of credit. At December 31,
    2004 there were no direct borrowings under the line of credit.





| |                                            
| | -------------------------------------------
| | Clean Fuels and Consent Decree Expenditures





|                                   |  |        |         | 
|---------------------------------- |  | ------ | ------- | 
|Projected Capital Expenditures     |  | Amount |        
|                                   |  |        |        
|Yorktown  Clean Fuels             |  | $      | 70,000  | 
|Four Corners  Clean Fuels         |  |        | 25,000  | 
|Yorktown  Sewer System            |  |        | 3,500   | 
|Yorktown Consent Decree            |  |        | 27,000  | 
|                                   |  |        |        
|Total Anticipated Cash Obligations |  | $      | 125,500 | 
|                                   |  |        |        





| |   |                                                             
| | - | ------------------------------------------------------------
| |  | Yorktown  Clean Fuels  $60,000,000 to
    $70,000,000;    
|
| |  | Four Corners  Clean Fuels  $15,000,000 to
    $25,000,000;
|
| |  | Yorktown  Sewer System  $1,500,000 to
    $3,500,000; and 
|
| |  | Consent Decree  $20,000,000 to $27,000,000                 



| |                  
| | -----------------
| | Cash Requirements





| |   |                                                             
| | - | ------------------------------------------------------------
| |  | the current operating environment for all of our operations;

38



---



##### Table of Contents





| |   |                                                           
| | - | ----------------------------------------------------------
| |  | current cash balances; and                                
|
| |  | availability of funds under our revolving credit facility.





| |          
| | ---------
| | Dividends





| |                
| | ---------------
| | Risk Management















| |      
| | -----
| | Other



39



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##### Table of Contents











| |   |                                                                                                      
| | - | -----------------------------------------------------------------------------------------------------
| |  | the speculative nature of remediation and cleanup cost estimates
    and methods;                    
|
| |  | imprecise and conflicting data regarding the hazardous nature of
    various substances;             
|
| |  | the number of other potentially responsible parties involved;                                        
|
| |  | defenses that may be available to us; and                                                            
|
| |  | changing environmental, health and safety laws, including
    changing interpretations of these laws.







| |   |                                                                                                                                           
| | - | ------------------------------------------------------------------------------------------------------------------------------------------
| |  | the installation and operation of refinery equipment, pollution
    control systems and other equipment not currently possessed by
    us;
|
| |  | the acquisition or modification of permits applicable to our
    activities; and                                                          
|
| |  | the initiation or modification of cleanup activities.                                                                                     

40



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Summary of Accrued Environmental Contingencies


|                                      |        |                |       |       |            |   |     |          |  |       |          |        |          |            |       |       |          |       |     |          |  |   |        |        |   |   |       |       | 
|------------------------------------- | ------ | -------------- | ----- | ----- | ---------- | - | --- | -------- |  | ----- | -------- | ------ | -------- | ---------- | ----- | ----- | -------- | ----- | --- | -------- |  | - | ------ | ------ | - | - | ----- | ----- | 
|                                      |        | As of          |       |       | Increase   |   |     |          |  | As of |          |        | Increase |            |       |       |          | As of |    
|                                      |        | 12/31/02       |       |       | (Decrease) |   |     | Payments |  |       | 12/31/03 |        |          | (Decrease) |       |       | Payments |       |     | 12/31/04 | 
|                                      |        |                |       |       |            |   |     |          |  |       |          |        |          |            |       |       |          |       |     |          | 
|                                      |        | (In thousands) |      
|Farmington Refinery                   |        | $              | 570   |       |            | $ |    |          |  | $     |         |        |          | $          | 570   |       |          | $     |    |          |  | $ |       |        |   | $ | 570   |      
|Ciniza  Land Treatment Facility      |        |                | 189   |       |            |   |    |          |  |       | (3       | )      |          |            | 186   |       |          |       |    |          |  |   |       |        |   |   | 186   |      
|Bloomfield Tank Farm (Old Terminal)   |        |                | 89    |       |            |   |    |          |  |       | (22      | )      |          |            | 67    |       |          |       |    |          |  |   | (14    | )      |   |   | 53    |      
|Ciniza  Solid Waste Management Units |        |                | 275   |       |            |   |    |          |  |       |         |        |          |            | 275   |       |          |       |    |          |  |   | (1     | )      |   |   | 274   |      
|Bloomfield Refinery                   |        |                | 310   |       |            |   |    |          |  |       | (43      | )      |          |            | 267   |       |          |       |    |          |  |   | (16    | )      |   |   | 251   |      
|Ciniza Well Closures                  |        |                | 100   |       |            |   | 40  |          |  |       |         |        |          |            | 140   |       |          |       |    |          |  |   | (31    | )      |   |   | 109   |      
|Retail Service Stations  Various     |        |                | 119   |       |            |   | 60  |          |  |       | (33      | )      |          |            | 146   |       |          |       | 3   |          |  |   | (11    | )      |   |   | 138   |      
|East Outfall  Bloomfield             |        |                |      |       |            |   | 202 |          |  |       | (177     | )      |          |            | 25    |       |          |       |    |          |  |   | (25    | )      |   |   |      |      
|West Outfall  Bloomfield             |        |                |      |       |            |   |    |          |  |       |         |        |          |            |      |       |          |       | 150 |          |  |   | (106   | )      |   |   | 44    |      
|Yorktown Refinery                     |        |                | 6,715 |       |            |   |    |          |  |       | (799     | )      |          |            | 5,916 |       |          |       |    |          |  |   | (1,385 | )      |   |   | 4,531 |      
|                                      |        |                |       |       |            |   |     |          |  |       |          |        |          |            |       |       |          |       |     |          | 
|                                      | Totals |                | $     | 8,367 |            |   | $   | 302      |  |       | $        | (1,077 | )        |            | $     | 7,592 |          |       | $   | 153      |  |   | $      | (1,589 | ) |   | $     | 6,156 | 
|                                      |        |                |       |       |            |   |     |          |  |       |          |        |          |            |       |       |          |       |     |          | 









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| |                           
| | --------------------------
| | Forward-Looking Statements









| |   |                                                                                                 
| | - | ------------------------------------------------------------------------------------------------
| |  | the availability of crude oil and the adequacy and costs of raw
    material supplies generally;
|
| |  | our ability to negotiate new crude oil supply contracts;                                        

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| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the risk that our long-term crude oil supply agreement with
    Statoil will not supply a significant portion of the crude oil
    needs of our Yorktown refinery over the term of the agreement,
    and will not reduce our crude oil costs, improve our high-value
    product output, contribute significantly to higher earnings,
    improve our competitiveness, or reduce the impact of crude oil
    markets pricing volatility;                                           
|
| |  | our ability to successfully manage the liabilities, including
    environmental liabilities, that we assumed in the Yorktown
    acquisition;                                                                                                                                                                                                                                                                                                                                        
|
| |  | our ability to obtain anticipated levels of indemnification
    associated with prior acquisitions and sales of assets;                                                                                                                                                                                                                                                                                                                                                              
|
| |  | competitive pressures from existing competitors and new
    entrants, including the potential effects of various pipeline
    projects (including the potential effects from the start-up of
    the Longhorn pipeline), and other actions that may impact our
    markets;                                                                                                                                                                                                          
|
| |  | volatility in the difference, or spread, between market prices
    for refined products and crude oil and other feedstocks;                                                                                                                                                                                                                                                                                                                                                          
|
| |  | the risk that our operations will not remain competitive and
    realize acceptable sales volumes and margins in those markets
    where they currently do so;                                                                                                                                                                                                                                                                                                                       
|
| |  | our ability to adequately control capital and operating
    expenses, including costs to comply with the Sarbanes-Oxley Act;                                                                                                                                                                                                                                                                                                                                                         
|
| |  | the risk that we will be unable to draw on our lines of credit,
    secure additional financing, access the public debt or equity
    markets or sell sufficient assets if we are unable to fund
    anticipated capital expenditures from cash flow generated by
    operations;                                                                                                                                                                                                    
|
| |  | the risk of increased costs resulting from employee matters,
    including increased employee benefit costs;                                                                                                                                                                                                                                                                                                                                                                         
|
| |  | the risk that we will not be able to renew the contract with the
    union at our Yorktown refinery on terms satisfactory to us or at
    all;                                                                                                                                                                                                                                                                                                                                       
|
| |  | the adoption of new state, federal or tribal legislation or
    regulations; changes to existing legislation or regulations or
    their interpretation by regulators or the courts; regulatory or
    judicial findings, including penalties; as well as other future
    governmental actions that may affect our operations, including
    the impact of any further changes to government-mandated
    specifications for gasoline, diesel fuel and other petroleum
    products;
|
| |  | unplanned or extended shutdowns in refinery operations;                                                                                                                                                                                                                                                                                                                                                                                                                              
|
| |  | the risk that we will not remain in compliance with covenants,
    and other terms and conditions, contained in our notes and
    credit facility;                                                                                                                                                                                                                                                                                                                                   
|
| |  | the risk that we will not be able to post satisfactory letters
    of credit;                                                                                                                                                                                                                                                                                                                                                                                                        
|
| |  | general economic factors affecting our operations, markets,
    products, services and prices;                                                                                                                                                                                                                                                                                                                                                                                       
|
| |  | unexpected environmental remediation costs;                                                                                                                                                                                                                                                                                                                                                                                                                                          
|
| |  | weather conditions affecting our operations or the areas in
    which our products are refined or marketed;                                                                                                                                                                                                                                                                                                                                                                          
|
| |  | the risk we will be found to have substantial liability in
    connection with existing or pending litigation;                                                                                                                                                                                                                                                                                                                                                                       
|
| |  | the occurrence of events that cause losses for which we are not
    fully insured;                                                                                                                                                                                                                                                                                                                                                                                                   
|
| |  | the risk that costs associated with environmental projects will
    be higher than currently estimated (including costs associated
    with the resolution of outstanding environmental matters and
    costs associated with reducing the sulfur content of motor fuel)
    or that we will be unable to complete such projects (including
    motor fuel sulfur reduction projects) by applicable regulatory
    compliance deadlines;                                             

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| |   |                                                                                                                                                                                                
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the risk that we will be added as a defendant in additional MTBE
    lawsuits, and that we will incur substantial liabilities and
    substantial defense costs in connection with these suits;
|
| |  | the risk that tax authorities will challenge the positions we
    have taken in preparing our tax returns;                                                                                     
|
| |  | the risk that changes in manufacturer promotional programs may
    adversely impact our retail operations; and                                                                                 
|
| |  | other risks described elsewhere in this report or described from
    time to time in our other filings with the Securities and
    Exchange Commission.                                        








|         |                                                               
|-------- | --------------------------------------------------------------
|Item 7A. | Quantitative and Qualitative Disclosures about Market
    Risk



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|        |                                            
|------- | -------------------------------------------
|Item 8. | Financial Statements and Supplementary Data

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
















Internal Control-Integrated Framework








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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


CONSOLIDATED BALANCE SHEETS


|                                                               |                                                                                                                                                                                                                |                                                              |                            |          |         |         |         |          |         |         | 
|-------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------ | -------------------------- | -------- | ------- | ------- | ------- | -------- | ------- | ------- | 
|                                                               |                                                                                                                                                                                                                | December 31,                                                 |                           
|                                                               |                                                                                                                                                                                                                |                                                              |                           
|                                                               |                                                                                                                                                                                                                | 2004                                                         |                            |          | 2003    |        
|                                                               |                                                                                                                                                                                                                |                                                              |                            |          |         |        
|                                                               |                                                                                                                                                                                                                | (In thousands, except                                        |                           
|                                                               |                                                                                                                                                                                                                | share and per share data)                                    |                           
|ASSETS                                                        
|Current assets:                                                |                                                                                                                                                                                                                |                                                              |                            |          |         |         |         |         
|                                                               | Cash and cash equivalents                                                                                                                                                                                      |                                                              | $                          | 23,714   |         |         | $       | 27,263   |        
|                                                               | Receivables:                                                                                                                                                                                                   |                                                              |                            |          |         |         |         |          |        
|                                                               |                                                                                                                                                                                                                | Trade, less allowance for doubtful accounts of $329 and $390 |                            |          | 90,518  |         |         |          | 74,176  |        
|                                                               |                                                                                                                                                                                                                | Income tax refunds                                           |                            |          | 3,185   |         |         |          | 1,397   |        
|                                                               |                                                                                                                                                                                                                | Other                                                        |                            |          | 7,989   |         |         |          | 7,215   |        
|                                                               |                                                                                                                                                                                                                |                                                              |                            |          |         |        
|                                                               |                                                                                                                                                                                                                |                                                              | 101,692                    |          |         |         | 82,788  |         
|                                                               |                                                                                                                                                                                                                |                                                              |                            |          |         |        
|                                                               | Inventories (Note 2)                                                                                                                                                                                           |                                                              |                            | 93,500   |         |         |         | 133,621  |        
|                                                               | Prepaid expenses and other                                                                                                                                                                                     |                                                              |                            | 11,265   |         |         |         | 8,030    |        
|                                                               | Deferred income taxes (Note 14)                                                                                                                                                                                |                                                              |                            | 1,834    |         |         |         |         |        
|                                                               |                                                                                                                                                                                                                |                                                              |                            |          |         |        
|                                                               |                                                                                                                                                                                                                | Total current assets                                         |                            |          | 232,005 |         |         |          | 251,702 |        
|                                                               |                                                                                                                                                                                                                |                                                              |                            |          |         |        
|Property, plant and equipment (Note 3)                         |                                                                                                                                                                                                                |                                                              | 671,851                    |          |         |         | 628,718 |         
|                                                               | Less accumulated depreciation and amortization                                                                                                                                                                 |                                                              |                            | (265,475 | )       |         |         | (235,539 | )      
|                                                               |                                                                                                                                                                                                                |                                                              |                            |          |         |        
|                                                               |                                                                                                                                                                                                                |                                                              | 406,376                    |          |         |         | 393,179 |         
|                                                               |                                                                                                                                                                                                                |                                                              |                            |          |         |        
|Goodwill (Note 4)                                              |                                                                                                                                                                                                                |                                                              | 40,303                     |          |         |         | 24,578  |         
|Assets held for sale (Note 5)                                  |                                                                                                                                                                                                                |                                                              |                           |          |         |         | 5,190   |         
|Other assets (Note 4)                                          |                                                                                                                                                                                                                |                                                              | 23,722                     |          |         |         | 25,005  |         
|                                                               |                                                                                                                                                                                                                |                                                              |                            |          |         |        
|                                                               |                                                                                                                                                                                                                | $                                                            | 702,406                    |          |         | $       | 699,654 |         
|                                                               |                                                                                                                                                                                                                |                                                              |                            |          |         |        
|                                                              
|LIABILITIES AND STOCKHOLDERS EQUITY                          
|Current liabilities:                                           |                                                                                                                                                                                                                |                                                              |                            |          |         |         |         |         
|                                                               | Current portion of long-term debt (Note 8)                                                                                                                                                                     |                                                              | $                          |         |         |         | $       | 11,128   |        
|                                                               | Accounts payable                                                                                                                                                                                               |                                                              |                            | 75,554   |         |         |         | 86,651   |        
|                                                               | Accrued expenses (Note 6)                                                                                                                                                                                      |                                                              |                            | 53,279   |         |         |         | 56,629   |        
|                                                               |                                                                                                                                                                                                                |                                                              |                            |          |         |        
|                                                               |                                                                                                                                                                                                                | Total current liabilities                                    |                            |          | 128,833 |         |         |          | 154,408 |        
|                                                               |                                                                                                                                                                                                                |                                                              |                            |          |         |        
|Long-term debt, net of current portion (Note 8)                |                                                                                                                                                                                                                |                                                              | 292,759                    |          |         |         | 355,601 |         
|Deferred income taxes (Note 14)                                |                                                                                                                                                                                                                |                                                              | 41,039                     |          |         |         | 28,039  |         
|Other liabilities and deferred income                          |                                                                                                                                                                                                                |                                                              | 23,336                     |          |         |         | 22,170  |         
|Commitments and contingencies (Notes 8, 10, 12, 13 and
    17) |                                                                                                                                                                                                                |                                                              |                            |          |         |         |         |         
|Stockholders equity:                                          |                                                                                                                                                                                                                |                                                              |                            |          |         |         |         |         
|                                                               | Preferred stock, par value $.01 per share,
    10,000,000 shares authorized, none issued Common stock, par
    value $.01 per share, 50,000,000 shares authorized,
    16,085,631 and 12,537,535 shares issued |                                                              |                            | 161      |         |         |         | 126      |        
|                                                               | Additional paid-in capital                                                                                                                                                                                     |                                                              |                            | 135,407  |         |         |         | 74,660   |        
|                                                               | Retained earnings                                                                                                                                                                                              |                                                              |                            | 117,325  |         |         |         | 101,104  |        
|                                                               |                                                                                                                                                                                                                |                                                              |                            |          |         |        
|                                                               |                                                                                                                                                                                                                |                                                              | 252,893                    |          |         |         | 175,890 |         
|                                                               | Less common stock in treasury  at cost,
    3,751,980 shares                                                                                                                                                  |                                                              |                            | (36,454  | )       |         |         | (36,454  | )      
|                                                               |                                                                                                                                                                                                                |                                                              |                            |          |         |        
|                                                               |                                                                                                                                                                                                                |                                                              | Total stockholders equity |          |         | 216,439 |         |          |         | 139,436 | 
|                                                               |                                                                                                                                                                                                                |                                                              |                            |          |         |        
|                                                               |                                                                                                                                                                                                                | $                                                            | 702,406                    |          |         | $       | 699,654 |         
|                                                               |                                                                                                                                                                                                                |                                                              |                            |          |         |        



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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


CONSOLIDATED STATEMENTS OF OPERATIONS


|                                                                                                    |                                     |                                                     |           |      |       |   |           |      |       |   |           |        |       |  
|--------------------------------------------------------------------------------------------------- | ----------------------------------- | --------------------------------------------------- | --------- | ---- | ----- | - | --------- | ---- | ----- | - | --------- | ------ | ----- | -
|                                                                                                    |                                     | Year Ended December 31,                             |          
|                                                                                                    |                                     |                                                     |          
|                                                                                                    |                                     | 2004                                                |           |      | 2003  |   |           | 2002 |      
|                                                                                                    |                                     |                                                     |           |      |       |   |           |      |      
|                                                                                                    |                                     | (In thousands, except per share data)               |          
|Net revenues                                                                                        |                                     | $                                                   | 2,512,005 |      |       | $ | 1,809,662 |      |       | $ | 1,252,026 |       
|Cost of products sold (excluding depreciation and amortization)                                     |                                     |                                                     | 2,186,426 |      |       |   | 1,512,306 |      |       |   | 1,045,124 |       
|                                                                                                    |                                     |                                                     |           |      |       |   |           |      |      
|Gross margin                                                                                        |                                     |                                                     | 325,579   |      |       |   | 297,356   |      |       |   | 206,902   |       
|Operating expenses                                                                                  |                                     |                                                     | 175,957   |      |       |   | 164,240   |      |       |   | 126,792   |       
|Depreciation and amortization                                                                       |                                     |                                                     | 37,129    |      |       |   | 36,887    |      |       |   | 35,175    |       
|Selling, general and administrative expenses                                                        |                                     |                                                     | 37,834    |      |       |   | 30,617    |      |       |   | 25,555    |       
|Net loss (gain) on the disposal/write-down of assets,
    including assets held for sale            |                                     |                                                     | 161       |      |       |   | 1,837     |      |       |   | (579      | )     
|Gain from insurance settlement due to fire incident                                                 |                                     |                                                     | (3,907    | )    |       |   |          |      |       |   |          |       
|                                                                                                    |                                     |                                                     |           |      |       |   |           |      |      
|Operating income                                                                                    |                                     |                                                     | 78,405    |      |       |   | 63,775    |      |       |   | 19,959    |       
|Interest expense                                                                                    |                                     |                                                     | (32,907   | )    |       |   | (38,993   | )    |       |   | (36,308   | )     
|Costs associated with early debt extinguishment                                                     |                                     |                                                     | (10,564   | )    |       |   |          |      |       |   |          |       
|Amortization/write-off of financing costs                                                           |                                     |                                                     | (8,341    | )    |       |   | (4,696    | )    |       |   | (3,256    | )     
|Interest and investment income                                                                      |                                     |                                                     | 354       |      |       |   | 162       |      |       |   | 431       |       
|                                                                                                    |                                     |                                                     |           |      |       |   |           |      |      
|Earnings (loss) from continuing operations before income taxes                                      |                                     |                                                     | 26,947    |      |       |   | 20,248    |      |       |   | (19,174   | )     
|Provision (benefit) for income taxes                                                                |                                     |                                                     | 10,655    |      |       |   | 7,936     |      |       |   | (7,654    | )     
|                                                                                                    |                                     |                                                     |           |      |       |   |           |      |      
|Earnings (loss) from continuing operations                                                          |                                     |                                                     | 16,292    |      |       |   | 12,312    |      |       |   | (11,520   | )     
|                                                                                                    |                                     |                                                     |           |      |       |   |           |      |      
|Discontinued operations (Note 5)
    Loss from operations of discontinued retail units              |                                     |                                                     | (143      | )    |       |   | (677      | )    |       |   | (1,664    | )     
|                                                                                                    | Gain on disposal                    |                                                     |           | 525  |       |   |           | 279  |       |   |           | 6,465  |      
|                                                                                                    | Net loss on asset sales/write-downs |                                                     |           | (497 | )     |   |           | (233 | )     |   |           | (1,150 | )    
|                                                                                                    |                                     |                                                     |           |      |       |   |           |      |      
|                                                                                                    |                                     |                                                     | (115      | )    |       |   | (631      | )    |       |   | 3,651     |       
|                                                                                                    |                                     | (Benefit) provision for income taxes                |           |      | (44   | ) |           |      | (242  | ) |           |        | 1,398 |  
|                                                                                                    |                                     |                                                     |           |      |       |   |           |      |      
|                                                                                                    |                                     | (Loss) earnings from discontinued operations        |           |      | (71   | ) |           |      | (389  | ) |           |        | 2,253 |  
|                                                                                                    |                                     |                                                     |           |      |       |   |           |      |      
|Cumulative effect of change in accounting principle, net of
    income tax benefit of $468 (Note 7) |                                     |                                                     |          |      |       |   | (704      | )    |       |   |          |       
|                                                                                                    |                                     |                                                     |           |      |       |   |           |      |      
|Net earnings (loss)                                                                                 |                                     | $                                                   | 16,221    |      |       | $ | 11,219    |      |       | $ | (9,267    | )     
|                                                                                                    |                                     |                                                     |           |      |       |   |           |      |      
|Earnings (loss) per common share:                                                                   |                                     |                                                     |           |      |       |   |           |      |       |   |           |       
|                                                                                                    | Basic                               |                                                     |           |      |       |   |           |      |       |   |           |        |      
|                                                                                                    |                                     | Continuing operations                               |           | $    | 1.47  |   |           | $    | 1.41  |   |           | $      | (1.34 | )
|                                                                                                    |                                     | Discontinued operations                             |           |      | (0.01 | ) |           |      | (0.05 | ) |           |        | 0.26  |  
|                                                                                                    |                                     | Cumulative effect of change in accounting principle |           |      |      |   |           |      | (0.08 | ) |           |        |      |  
|                                                                                                    |                                     |                                                     |           |      |       |   |           |      |      
|                                                                                                    |                                     | $                                                   | 1.46      |      |       | $ | 1.28      |      |       | $ | (1.08     | )     
|                                                                                                    |                                     |                                                     |           |      |       |   |           |      |      
|                                                                                                    | Assuming dilution                   |                                                     |           |      |       |   |           |      |       |   |           |        |      
|                                                                                                    |                                     | Continuing operations                               |           | $    | 1.43  |   |           | $    | 1.40  |   |           | $      | (1.34 | )
|                                                                                                    |                                     | Discontinued operations                             |           |      | (0.01 | ) |           |      | (0.05 | ) |           |        | 0.26  |  
|                                                                                                    |                                     | Cumulative effect of change in accounting principle |           |      |      |   |           |      | (0.08 | ) |           |        |      |  
|                                                                                                    |                                     |                                                     |           |      |       |   |           |      |      
|                                                                                                    |                                     | $                                                   | 1.42      |      |       | $ | 1.27      |      |       | $ | (1.08     | )     
|                                                                                                    |                                     |                                                     |           |      |       |   |           |      |      



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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY


|                                       |  |              |            |            |       |                                 |     |         |                |   |          |       |  |        |         |   |               |  |           |        |  |   |         |   |  |   |         |  
|-------------------------------------- |  | ------------ | ---------- | ---------- | ----- | ------------------------------- | --- | ------- | -------------- | - | -------- | ----- |  | ------ | ------- | - | ------------- |  | --------- | ------ |  | - | ------- | - |  | - | ------- | -
|                                       |  | Common Stock |            |            |       |                                 |     |         |                |   |          |       | 
|                                       |  |              |            |            |       |                                 |     |         |                |   |         
|                                       |  |              |            | Additional |       |                                 |     |         | Treasury Stock |   |          | Total | 
|                                       |  | Shares       |            |            | Par   |                                 |     | Paid-In |                |   | Retained |       |  |        |         |   | Stockholders | 
|                                       |  | Issued       |            |            | Value |                                 |     | Capital |                |   | Earnings |       |  | Shares |         |   | Cost          |  |           | Equity | 
|                                       |  |              |            |            |       |                                 |     |         |                |   |          |       |  |        |         |   |               |  |           |        | 
|                                       |  |              |            |            |       | (In thousands, except number of |     |         |                |   |         
|                                       |  |              |            |            |       | shares)                         |     |         |                |   |         
|Balances, January 1, 2002              |  |              | 12,305,859 |            |       | $                               | 123 |         |                | $ | 73,589   |       |  | $      | 99,152  |   |               |  | 3,751,980 |        |  | $ | (36,454 | ) |  | $ | 136,410 |  
|Stock options exercised                |  |              | 17,900     |            |       |                                 |    |         |                |   | 94       |       |  |        |        |   |               |  |          |        |  |   |        |   |  |   | 94      |  
|Stock option compensation              |  |              |           |            |       |                                 |    |         |                |   | 80       |       |  |        |        |   |               |  |          |        |  |   |        |   |  |   | 80      |  
|Net loss                               |  |              |           |            |       |                                 |    |         |                |   |         |       |  |        | (9,267  | ) |               |  |          |        |  |   |        |   |  |   | (9,267  | )
|                                       |  |              |            |            |       |                                 |     |         |                |   |          |       |  |        |         |   |               |  |           |        | 
|Balances, December 31, 2002            |  |              | 12,323,759 |            |       |                                 | 123 |         |                |   | 73,763   |       |  |        | 89,885  |   |               |  | 3,751,980 |        |  |   | (36,454 | ) |  |   | 127,317 |  
|401(k) plan contribution               |  |              | 213,776    |            |       |                                 | 3   |         |                |   | 897      |       |  |        |        |   |               |  |          |        |  |   |        |   |  |   | 900     |  
|Net earnings                           |  |              |           |            |       |                                 |    |         |                |   |         |       |  |        | 11,219  |   |               |  |          |        |  |   |        |   |  |   | 11,219  |  
|                                       |  |              |            |            |       |                                 |     |         |                |   |          |       |  |        |         |   |               |  |           |        | 
|Balances, December 31, 2003            |  |              | 12,537,535 |            |       |                                 | 126 |         |                |   | 74,660   |       |  |        | 101,104 |   |               |  | 3,751,980 |        |  |   | (36,454 | ) |  |   | 139,436 |  
|401(k) plan contribution               |  |              | 49,046     |            |       |                                 | 1   |         |                |   | 899      |       |  |        |        |   |               |  |          |        |  |   |        |   |  |   | 900     |  
|Stock options exercised                |  |              | 215,750    |            |       |                                 | 2   |         |                |   | 1,447    |       |  |        |        |   |               |  |          |        |  |   |        |   |  |   | 1,449   |  
|Tax benefit of stock options exercised |  |              |           |            |       |                                 |    |         |                |   | 1,059    |       |  |        |        |   |               |  |          |        |  |   |        |   |  |   | 1,059   |  
|Stock issued                           |  |              | 3,283,300  |            |       |                                 | 32  |         |                |   | 57,342   |       |  |        |        |   |               |  |          |        |  |   |        |   |  |   | 57,374  |  
|Net earnings                           |  |              |           |            |       |                                 |    |         |                |   |         |       |  |        | 16,221  |   |               |  |          |        |  |   |        |   |  |   | 16,221  |  
|                                       |  |              |            |            |       |                                 |     |         |                |   |          |       |  |        |         |   |               |  |           |        | 
|Balances, December 31, 2004            |  |              | 16,085,631 |            |       | $                               | 161 |         |                | $ | 135,407  |       |  | $      | 117,325 |   |               |  | 3,751,980 |        |  | $ | (36,454 | ) |  | $ | 216,439 |  
|                                       |  |              |            |            |       |                                 |     |         |                |   |          |       |  |        |         |   |               |  |           |        | 



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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


CONSOLIDATED STATEMENTS OF CASH FLOWS


|                                                                                                    |                                                                                                                       |                                         |         |          |         |   |         |          |         |   |          |          |         |  
|--------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------- | --------------------------------------- | ------- | -------- | ------- | - | ------- | -------- | ------- | - | -------- | -------- | ------- | -
|                                                                                                    |                                                                                                                       | Year Ended December 31,                 |        
|                                                                                                    |                                                                                                                       |                                         |        
|                                                                                                    |                                                                                                                       | 2004                                    |         |          | 2003    |   |         | 2002     |        
|                                                                                                    |                                                                                                                       |                                         |         |          |         |   |         |          |        
|                                                                                                    |                                                                                                                       | (In thousands)                          |        
|Cash flows from operating activities:                                                               |                                                                                                                       |                                         |         |          |         |   |         |          |         |   |          |         
|                                                                                                    | Net earnings (loss)                                                                                                   |                                         | $       | 16,221   |         |   | $       | 11,219   |         |   | $        | (9,267   | )      
|Adjustments to reconcile net earnings (loss) from to net cash
    provided by operating activities: |                                                                                                                       |                                         |         |          |         |   |         |          |         |   |          |         
|                                                                                                    | Cumulative effect of change in accounting principle, net                                                              |                                         |         |         |         |   |         | 704      |         |   |          |         |        
|                                                                                                    | Depreciation and amortization from continuing operations                                                              |                                         |         | 37,129   |         |   |         | 36,887   |         |   |          | 35,175   |        
|                                                                                                    | Depreciation and amortization from discontinued operations                                                            |                                         |         | 69       |         |   |         | 630      |         |   |          | 1,959    |        
|                                                                                                    | Amortization/write-off of financing costs                                                                             |                                         |         | 8,341    |         |   |         | 4,696    |         |   |          | 3,256    |        
|                                                                                                    | Deferred income taxes                                                                                                 |                                         |         | 8,565    |         |   |         | 7,971    |         |   |          | 131      |        
|                                                                                                    | Deferred crude oil purchase discounts                                                                                 |                                         |         | 2,296    |         |   |         |         |         |   |          |         |        
|                                                                                                    | Net loss (gain) on the disposal/write-down of assets from
    continuing operations, including assets held for sale   |                                         |         | 161      |         |   |         | 1,837    |         |   |          | (579     | )      
|                                                                                                    | Net (gain) loss on the disposal/write-down of assets from
    discontinued operations, including assets held for sale |                                         |         | (28      | )       |   |         | (46      | )       |   |          | (5,315   | )      
|                                                                                                    | (Gain) from insurance settlement of fire incident                                                                     |                                         |         | (4,538   | )       |   |         |         |         |   |          |         |        
|                                                                                                    | Income tax benefit from exercise of stock options                                                                     |                                         |         | 1,059    |         |   |         |         |         |   |          |         |        
|                                                                                                    | Changes in operating assets and liabilities                                                                           |                                         |         |          |         |   |         |          |         |   |          |          |        
|                                                                                                    |                                                                                                                       | (Increase) decrease in receivables      |         |          | (18,830 | ) |         |          | (6,700  | ) |          |          | (32,558 | )
|                                                                                                    |                                                                                                                       | Decrease (increase) in inventories      |         |          | 39,859  |   |         |          | (25,386 | ) |          |          | 18,831  |  
|                                                                                                    |                                                                                                                       | (Increase) decrease in prepaid expenses |         |          | (3,823  | ) |         |          | 335     |   |          |          | (4,236  | )
|                                                                                                    |                                                                                                                       | (Increase) decrease in other assets     |         |          | (45     | ) |         |          | (1,095  | ) |          |          | 23      |  
|                                                                                                    |                                                                                                                       | (Decrease) increase in accounts payable |         |          | (11,096 | ) |         |          | 19,369  |   |          |          | 25,027  |  
|                                                                                                    |                                                                                                                       | Increase in accrued expenses            |         |          | 451     |   |         |          | 11,371  |   |          |          | 5,809   |  
|                                                                                                    |                                                                                                                       | Increase in other liabilities           |         |          | 723     |   |         |          | 557     |   |          |          | (188    | )
|                                                                                                    |                                                                                                                       |                                         |         |          |         |   |         |          |        
|Net cash provided by operating activities                                                           |                                                                                                                       |                                         | 76,514  |          |         |   | 62,349  |          |         |   | 38,068   |         
|                                                                                                    |                                                                                                                       |                                         |         |          |         |   |         |          |        
|Cash flows from investing activities:                                                               |                                                                                                                       |                                         |         |          |         |   |         |          |         |   |          |         
|                                                                                                    | Purchase of property, plant and equipment                                                                             |                                         |         | (58,671  | )       |   |         | (17,879  | )       |   |          | (12,990  | )      
|                                                                                                    | Proceeds from assets held for sale and discontinued operations                                                        |                                         |         | 9,977    |         |   |         | 9,653    |         |   |          | 17,905   |        
|                                                                                                    | Yorktown refinery acquisition contingent payment                                                                      |                                         |         | (16,146  | )       |   |         | (8,854   | )       |   |          |         |        
|                                                                                                    | Yorktown refinery acquisition                                                                                         |                                         |         |         |         |   |         |         |         |   |          | (194,733 | )      
|                                                                                                    | Net proceeds from insurance settlement of fire incident                                                               |                                         |         | 6,612    |         |   |         |         |         |   |          |         |        
|                                                                                                    | Proceeds from sale of property, plant and equipment and other
    assets                                              |                                         |         | 1,846    |         |   |         | 11,780   |         |   |          | 1,612    |        
|                                                                                                    |                                                                                                                       |                                         |         |          |         |   |         |          |        
|Net cash used in investing activities                                                               |                                                                                                                       |                                         | (56,382 | )        |         |   | (5,300  | )        |         |   | (188,206 | )       
|                                                                                                    |                                                                                                                       |                                         |         |          |         |   |         |          |        
|Cash flows from financing activities:                                                               |                                                                                                                       |                                         |         |          |         |   |         |          |         |   |          |         
|                                                                                                    | Payments of long-term debt                                                                                            |                                         |         | (212,060 | )       |   |         | (14,954  | )       |   |          | (107,822 | )      
|                                                                                                    | Payments on short term debt                                                                                           |                                         |         | (11,128  | )       |   |         |         |         |   |          |         |        
|                                                                                                    | Proceeds from line of credit                                                                                          |                                         |         |         |         |   |         | 96,000   |         |   |          | 93,000   |        
|                                                                                                    | Payments on line of credit                                                                                            |                                         |         |         |         |   |         | (121,000 | )       |   |          | (68,000  | )      
|                                                                                                    | Proceeds from issuance of long-term debt                                                                              |                                         |         | 147,467  |         |   |         |         |         |   |          | 234,144  |        
|                                                                                                    | Net proceeds from issuance of common stock                                                                            |                                         |         | 57,374   |         |   |         |         |         |   |          |         |        
|                                                                                                    | Proceeds from exercise of stock options                                                                               |                                         |         | 1,449    |         |   |         |         |         |   |          | 94       |        
|                                                                                                    | Deferred financing costs                                                                                              |                                         |         | (6,783   | )       |   |         |         |         |   |          | (17,436  | )      
|                                                                                                    |                                                                                                                       |                                         |         |          |         |   |         |          |        
|Net cash used in financing activities                                                               |                                                                                                                       |                                         | (23,681 | )        |         |   | (39,954 | )        |         |   | 133,980  |         
|                                                                                                    |                                                                                                                       |                                         |         |          |         |   |         |          |        
|Net (decrease) increase in cash and cash equivalents                                                |                                                                                                                       |                                         | (3,549  | )        |         |   | 17,095  |          |         |   | (16,158  | )       
|                                                                                                    | Cash and cash equivalents:                                                                                            |                                         |         |          |         |   |         |          |         |   |          |          |        
|                                                                                                    |                                                                                                                       | Beginning of year                       |         |          | 27,263  |   |         |          | 10,168  |   |          |          | 26,326  |  
|                                                                                                    |                                                                                                                       |                                         |         |          |         |   |         |          |        
|                                                                                                    |                                                                                                                       | End of year                             |         | $        | 23,714  |   |         | $        | 27,263  |   |          | $        | 10,168  |  
|                                                                                                    |                                                                                                                       |                                         |         |          |         |   |         |          |        
|Income taxes paid/(refunded)                                                                        |                                                                                                                       | $                                       | 1,797   |          |         | $ | (2,960  | )        |         | $ | (3,466   | )       
|                                                                                                    |                                                                                                                       |                                         |         |          |         |   |         |          |        
|Interest paid (net of capitalized interest)                                                         |                                                                                                                       | $                                       | 35,285  |          |         | $ | 38,645  |          |         | $ | 34,426   |         
|                                                                                                    |                                                                                                                       |                                         |         |          |         |   |         |          |        



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Significant Noncash Investing and Financing Activities by
year.




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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




|         |                                                  
|-------- | -------------------------------------------------
|Note 1  | Organization and Significant Accounting Policies:



| |             
| | ------------
| | Organization





| |   |                                                                                                                                                  
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------
| |  | on the East Coast  primarily in Virginia, Maryland,
    and North Carolina; and                                                                 
|
| |  | in the Southwest  primarily in New Mexico, Arizona,
    and Colorado, with a concentration in the Four Corners area
    where these states meet.







| |   |                      
| | - | ---------------------
| |  | our refining group;  
|
| |  | our retail group; and
|
| |  | Phoenix Fuel         





| |                            
| | ---------------------------
| | Principles of Consolidation





| |                                                                
| | ---------------------------------------------------------------
| | Use of Estimates in the Preparation of Financial
    Statements





| |             
| | ------------
| | Net Revenues





| |   |                                                                  
| | - | -----------------------------------------------------------------
| |  | persuasive evidence of an arrangement exists;                    
|
| |  | delivery has occurred or services have been rendered;            
|
| |  | the sellers price to the buyer is fixed or
    determinable; and
|
| |  | collectibility is reasonably assured.                            





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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)








| |                         
| | ------------------------
| | Statements of Cash Flows





| |            
| | -----------
| | Derivatives













| |                             
| | ----------------------------
| | Concentration of Credit Risk





| |                  
| | -----------------
| | Trade Receivables





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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)








|             |  |      |        |  |      |   |        | 
|------------ |  | ---- | ------ |  | ---- | - | ------ | 
|             |  | 2004 |        |  | 2003 |  
|             |  |      |        |  |      |  
|Trade        |  | $    | 88,232 |  |      | $ | 72,783 | 
|Credit cards |  |      | 2,286  |  |      |   | 1,393  | 
|             |  |      |        |  |      |  
|             |  | $    | 90,518 |  |      | $ | 74,176 | 
|             |  |      |        |  |      |  



| |            
| | -----------
| | Inventories





| |                              
| | -----------------------------
| | Property, Plant and Equipment



|                           |  |  |            | 
|-------------------------- |  |  | ---------- | 
|Buildings and improvements |  |  | 7-30 years | 
|Machinery and equipment    |  |  | 3-24 years | 
|Pipelines                  |  |  | 30 years   | 
|Furniture and fixtures     |  |  | 2-15 years | 
|Vehicles                   |  |  | 3-7 years  | 





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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




| |         
| | --------
| | Goodwill







| |                  
| | -----------------
| | Long-Lived Assets





| |                             
| | ----------------------------
| | Asset Retirement Obligations





| |               
| | --------------
| | Treasury Stock





| |                           
| | --------------------------
| | Environmental Expenditures





| |             
| | ------------
| | Income Taxes



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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




| |                          
| | -------------------------
| | Earnings Per Common Share





| |                           
| | --------------------------
| | Other Comprehensive Income





| |           
| | ----------
| | Guarantees





| |                                  
| | ---------------------------------
| | Stock-based Employee Compensation



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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                                                                                                                                       |                       |                         |        |      |      |   |        |      |  |   |        |       |  
|------------------------------------------------------------------------------------------------------------------------------------------------------ | --------------------- | ----------------------- | ------ | ---- | ---- | - | ------ | ---- |  | - | ------ | ----- | -
|                                                                                                                                                       |                       | Year Ended December 31, |       
|                                                                                                                                                       |                       |                         |       
|                                                                                                                                                       |                       | 2004                    |        |      | 2003 |   |        | 2002 | 
|                                                                                                                                                       |                       |                         |        |      |      |   |        |      | 
|                                                                                                                                                       |                       | (In thousands, except   |       
|                                                                                                                                                       |                       | per share data)         |       
|Net earnings (loss), as reported                                                                                                                       |                       | $                       | 16,221 |      |      | $ | 11,219 |      |  | $ | (9,267 | )    
|Add: Stock-based employee compensation expense included in
    reported net income, net of related tax effect                                          |                       |                         |       |      |      |   |       |      |  |   | 48     |      
|Deduct: Total stock-based employee compensation expense
    determined under the fair value based method for all awards, net
    of related tax effect |                       |                         | (143   | )    |      |   | (241   | )    |  |   | (221   | )    
|                                                                                                                                                       |                       |                         |        |      |      |   |        |      | 
|Pro forma net earnings (loss)                                                                                                                          |                       | $                       | 16,078 |      |      | $ | 10,978 |      |  | $ | (9,440 | )    
|                                                                                                                                                       |                       |                         |        |      |      |   |        |      | 
|Net earnings (loss) per share:                                                                                                                         |                       |                         |        |      |      |   |        |      |  |   |        |      
|                                                                                                                                                       | Basic  as reported   |                         | $      | 1.46 |      |   | $      | 1.28 |  |   | $      | (1.08 | )
|                                                                                                                                                       |                       |                         |        |      |      |   |        |      | 
|                                                                                                                                                       | Basic  pro forma     |                         | $      | 1.45 |      |   | $      | 1.26 |  |   | $      | (1.10 | )
|                                                                                                                                                       |                       |                         |        |      |      |   |        |      | 
|                                                                                                                                                       | Diluted  as reported |                         | $      | 1.42 |      |   | $      | 1.27 |  |   | $      | (1.08 | )
|                                                                                                                                                       |                       |                         |        |      |      |   |        |      | 
|                                                                                                                                                       | Diluted  pro forma   |                         | $      | 1.41 |      |   | $      | 1.24 |  |   | $      | (1.10 | )
|                                                                                                                                                       |                       |                         |        |      |      |   |        |      | 



| |                              
| | -----------------------------
| | New Accounting Pronouncements









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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)










| |                  
| | -----------------
| | Reclassifications





|         |             
|-------- | ------------
|Note 2  | Inventories:



|                                                  |                            |                |         |        |         |  |         |        |         | 
|------------------------------------------------- | -------------------------- | -------------- | ------- | ------ | ------- |  | ------- | ------ | ------- | 
|                                                  |                            | December 31,   |        
|                                                  |                            |                |        
|                                                  |                            | 2004           |         |        | 2003    | 
|                                                  |                            |                |         |        |         | 
|                                                  |                            | (In thousands) |        
|First-in, first-out (FIFO) method:              |                            |                |         |        |         |  |         |       
|                                                  | Crude oil                  |                | $       | 44,435 |         |  | $       | 54,771 |        
|                                                  | Refined products           |                |         | 68,863 |         |  |         | 68,622 |        
|                                                  | Refinery and shop supplies |                |         | 12,330 |         |  |         | 11,306 |        
|                                                  | Merchandise                |                |         | 3,092  |         |  |         | 2,946  |        
|Retail method:                                    |                            |                |         |        |         |  |         |       
|                                                  | Merchandise                |                |         | 9,419  |         |  |         | 11,474 |        
|                                                  |                            |                |         |        |         | 
|                                                  |                            | Subtotal       |         |        | 138,139 |  |         |        | 149,119 | 
|Adjustment for last-in, first-out (LIFO) method |                            |                | (44,639 | )      |         |  | (15,498 | )     
|                                                  |                            |                |         |        |         | 
|                                                  |                            | Total          |         | $      | 93,500  |  |         | $      | 133,621 | 
|                                                  |                            |                |         |        |         | 



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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                           |  |                         |            |  |      |   |           |      |  |   |           | 
|-------------------------- |  | ----------------------- | ---------- |  | ---- | - | --------- | ---- |  | - | --------- | 
|                           |  | Year Ended December 31, |           
|                           |  |                         |           
|                           |  | 2004                    |            |  | 2003 |   |           | 2002 | 
|                           |  |                         |            |  |      |   |           |      | 
|Net earnings               |  | $                       | 17,619,000 |  |      | $ | 3,514,000 |      |  | $ | 7,401,000 | 
|Diluted earnings per share |  | $                       | 1.55       |  |      | $ | 0.40      |      |  | $ | 0.86      | 



|                           |  |                         |           |  |      |   |           |      |  |   |         | 
|-------------------------- |  | ----------------------- | --------- |  | ---- | - | --------- | ---- |  | - | ------- | 
|                           |  | Year Ended December 31, |          
|                           |  |                         |          
|                           |  | 2004                    |           |  | 2003 |   |           | 2002 | 
|                           |  |                         |           |  |      |   |           |      | 
|Net earnings               |  | $                       | 9,505,000 |  |      | $ | 1,156,000 |      |  | $ | 660,000 | 
|Diluted earnings per share |  | $                       | 0.84      |  |      | $ | 0.22      |      |  | $ | 0.08    | 



|         |                               
|-------- | ------------------------------
|Note 3  | Property, Plant and Equipment:



|                                                |          |                |          |         |      |   |          |         | 
|----------------------------------------------- | -------- | -------------- | -------- | ------- | ---- | - | -------- | ------- | 
|                                                |          | December 31,   |         
|                                                |          |                |         
|                                                |          | 2004           |          |         | 2003 |  
|                                                |          |                |          |         |      |  
|                                                |          | (In thousands) |         
|Land and improvements                           |          | $              | 40,307   |         |      | $ | 44,394   |        
|Buildings and improvements                      |          |                | 105,429  |         |      |   | 101,865  |        
|Machinery and equipment (including turnarounds) |          |                | 469,571  |         |      |   | 433,479  |        
|Pipelines                                       |          |                | 10,582   |         |      |   | 10,268   |        
|Furniture and fixtures                          |          |                | 25,128   |         |      |   | 25,190   |        
|Vehicles                                        |          |                | 8,158    |         |      |   | 7,683    |        
|Construction in progress                        |          |                | 12,676   |         |      |   | 5,839    |        
|                                                |          |                |          |         |      |  
|                                                | Subtotal |                |          | 671,851 |      |   |          | 628,718 | 
|Accumulated depreciation and amortization       |          |                | (265,475 | )       |      |   | (235,539 | )      
|                                                |          |                |          |         |      |  
|                                                | Total    |                | $        | 406,376 |      |   | $        | 393,179 | 
|                                                |          |                |          |         |      |  



|         |                                      
|-------- | -------------------------------------
|Note 4  | Goodwill and Other Intangible Assets:





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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






|                                                                     |  |                |        |  |        |   |       |         |  |   |        |  |  |   |        |  
|-------------------------------------------------------------------- |  | -------------- | ------ |  | ------ | - | ----- | ------- |  | - | ------ |  |  | - | ------ | -
|                                                                     |  | Refining       |        |  | Retail |   |       | Phoenix |  |   |       
|                                                                     |  | Group          |        |  | Group  |   |       | Fuel    |  |   | Total  | 
|                                                                     |  |                |        |  |        |   |       |         |  |   |        | 
|                                                                     |  | (In thousands) |       
|Balance as of January 1, 2003                                        |  | $              | 125    |  |        | $ | 4,618 |         |  | $ | 14,722 |  |  | $ | 19,465 |  
|Yorktown refinery acquisition contingent consideration
    (Note 20) |  |                | 5,254  |  |        |   |      |         |  |   |       |  |  |   | 5,254  |  
|Goodwill written off related to the sale of certain retail units     |  |                |       |  |        |   | (113  | )       |  |   |       |  |  |   | (113   | )
|Impairment losses related to the closure of certain retail units     |  |                |       |  |        |   | (28   | )       |  |   |       |  |  |   | (28    | )
|                                                                     |  |                |        |  |        |   |       |         |  |   |        | 
|Balance as of January 1, 2004                                        |  |                | 5,379  |  |        |   | 4,477 |         |  |   | 14,722 |  |  |   | 24,578 |  
|Reclassification between Retail Group and Phoenix Fuel               |  |                |       |  |        |   | (14   | )       |  |   | 14     |  |  |   |       |  
|Yorktown refinery acquisition contingent consideration
    (Note 20) |  |                | 15,774 |  |        |   |      |         |  |   |       |  |  |   | 15,774 |  
|Goodwill written off related to the sale of certain retail units     |  |                |       |  |        |   | (38   | )       |  |   |       |  |  |   | (38    | )
|Impairment losses related to the closure of certain retail units     |  |                |       |  |        |   | (11   | )       |  |   |       |  |  |   | (11    | )
|                                                                     |  |                |        |  |        |   |       |         |  |   |        | 
|Balance as of December 31, 2004                                      |  | $              | 21,153 |  |        | $ | 4,414 |         |  | $ | 14,736 |  |  | $ | 40,303 |  
|                                                                     |  |                |        |  |        |   |       |         |  |   |        | 







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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                               |                      |                   |        |            |                   |   |       |          |  |       |          |       |  |              |        |       |          |         |       |              |  |   |       |       |  |  |  |    | 
|---------------------------------------------- | -------------------- | ----------------- | ------ | ---------- | ----------------- | - | ----- | -------- |  | ----- | -------- | ----- |  | ------------ | ------ | ----- | -------- | ------- | ----- | ------------ |  | - | ----- | ----- |  |  |  | -- | 
|                                               |                      | December 31, 2004 |        |            | December 31, 2003 |   |       |         
|                                               |                      |                   |        |            |                   |   |       | Weighted | 
|                                               |                      | Gross             |        |            |                   |   | Net   |          |  | Gross |          |       |  |              | Net    |       |          | Average |      
|                                               |                      | Carrying          |        |            | Amortization      |   |       | Carrying |  |       | Carrying |       |  | Accumulated  |        |       | Carrying |         |       | Amortization | 
|                                               |                      | Value             |        |            | Accumulated       |   |       | Value    |  |       | Value    |       |  | Amortization |        |       | Value    |         |       | Period       | 
|                                               |                      |                   |        |            |                   |   |       |          |  |       |          |       |  |              |        |       |          |         |       |              | 
|                                               |                      |                   |        | (In years) |                  
|                                               |                      | (In thousands)    |        |            |                  
|Amortized intangible assets:                   |                      |                   |        |            |                   |   |       |          |  |       |          |       |  |              |        |       |          |         |       |              |  |   |       |       |  |  |  |   
|                                               | Rights-of-way        |                   | $      | 3,630      |                   |   | $     | 2,708    |  |       | $        | 922   |  |              | $      | 3,564 |          |         | $     | 2,545        |  |   | $     | 1,019 |  |  |  | 22 | 
|                                               | Contracts            |                   |        | 1,367      |                   |   |       | 1,109    |  |       |          | 258   |  |              |        | 1,371 |          |         |       | 990          |  |   |       | 381   |  |  |  | 12 | 
|                                               | Licenses and permits |                   |        | 1,096      |                   |   |       | 379      |  |       |          | 717   |  |              |        | 1,019 |          |         |       | 198          |  |   |       | 821   |  |  |  | 13 | 
|                                               |                      |                   |        |            |                   |   |       |          |  |       |          |       |  |              |        |       |          |         |       |              | 
|                                               |                      |                   | 6,093  |            |                   |   | 4,196 |          |  |       | 1,897    |       |  |              | 5,954  |       |          |         | 3,733 |              |  |   | 2,221 |       |  |  |  |   
|                                               |                      |                   |        |            |                   |   |       |          |  |       |          |       |  |              |        |       |          |         |       |              | 
|Intangible assets not subject to amortization: |                      |                   |        |            |                   |   |       |          |  |       |          |       |  |              |        |       |          |         |       |              |  |   |       |       |  |  |  |   
|                                               | Liquor licenses      |                   |        | 7,315      |                   |   |       |         |  |       |          | 7,315 |  |              |        | 7,455 |          |         |       |             |  |   |       | 7,455 |  |  |  |    | 
|                                               |                      |                   |        |            |                   |   |       |          |  |       |          |       |  |              |        |       |          |         |       |              | 
|Total intangible assets                        |                      | $                 | 13,408 |            |                   | $ | 4,196 |          |  | $     | 9,212    |       |  | $            | 13,409 |       |          | $       | 3,733 |              |  | $ | 9,676 |       |  |  |  |   
|                                               |                      |                   |        |            |                   |   |       |          |  |       |          |       |  |              |        |       |          |         |       |              | 



|     |  |                |     | 
|---- |  | -------------- | --- | 
|     |  | (In thousands) |    
|2005 |  | $              | 409 | 
|2006 |  |                | 412 | 
|2007 |  |                | 263 | 
|2008 |  |                | 221 | 
|2009 |  |                | 219 | 



|         |                                                                        
|-------- | -----------------------------------------------------------------------
|Note 5  | Assets Held For Sale, Discontinued Operations, and Asset
    Disposals:



|                                                 |  |                         |      |   |      |   |        |      |  |   |        |  
|------------------------------------------------ |  | ----------------------- | ---- | - | ---- | - | ------ | ---- |  | - | ------ | -
|                                                 |  | Year Ended December 31, |     
|                                                 |  |                         |     
|                                                 |  | 2004                    |      |   | 2003 |   |        | 2002 | 
|                                                 |  |                         |      |   |      |   |        |      | 
|                                                 |  | (In thousands)          |     
|Net revenues                                     |  | $                       | 853  |   |      | $ | 26,776 |      |  | $ | 61,036 |  
|                                                 |  |                         |      |   |      |   |        |      | 
|Net operating loss on retail units               |  | $                       | (143 | ) |      | $ | (677   | )    |  | $ | (1,664 | )
|Gain on disposal of retail units                 |  |                         | 525  |   |      |   | 279    |      |  |   | 6,465  |  
|Impairment and other write-downs on retail units |  |                         | (497 | ) |      |   | (233   | )    |  |   | (1,150 | )
|                                                 |  |                         |      |   |      |   |        |      | 
|(Loss) earnings before income taxes              |  | $                       | (115 | ) |      | $ | (631   | )    |  | $ | 3,651  |  
|                                                 |  |                         |      |   |      |   |        |      | 
|Net (loss) earnings                              |  | $                       | (71  | ) |      | $ | (389   | )    |  | $ | 2,253  |  
|Allocated goodwill included in gain on disposal  |  | $                       | 38   |   |      | $ | 113    |      |  | $ | 308    |  

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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                                                                  |                               |                |   |              |  |   |       |     | 
|--------------------------------------------------------------------------------- | ----------------------------- | -------------- | - | ------------ |  | - | ----- | --- | 
|                                                                                  |                               | December 31,   |   | December 31, | 
|                                                                                  |                               | 2004           |   | 2003         | 
|                                                                                  |                               |                |   |              | 
|                                                                                  |                               | (In thousands) |  
|Operating retail units held for sale and included in
    discontinued operations: |                               |                |   |              |  |   |       |    
|                                                                                  | Property, plant and equipment |                | $ |             |  |   | $     | 330 | 
|                                                                                  | Inventories                   |                |   |             |  |   |       | 106 | 
|                                                                                  |                               |                |   |              |  |  
|                                                                                  |                               |                |  |              |  |   | 436   |    
|Closed retail units                                                               |                               |                |  |              |  |   | 3,158 |    
|Vacant land  industrial site                                                     |                               |                |  |              |  |   | 1,596 |    
|                                                                                  |                               |                |   |              |  |  
|                                                                                  |                               | $              |  |              |  | $ | 5,190 |    
|                                                                                  |                               |                |   |              |  |  







|         |                  
|-------- | -----------------
|Note 6  | Accrued Expenses:



|                                                        |       |                |        |        |      |   |        |        | 
|------------------------------------------------------- | ----- | -------------- | ------ | ------ | ---- | - | ------ | ------ | 
|                                                        |       | December 31,   |       
|                                                        |       |                |       
|                                                        |       | 2004           |        |        | 2003 |  
|                                                        |       |                |        |        |      |  
|                                                        |       | (In thousands) |       
|Excise taxes                                            |       | $              | 24,667 |        |      | $ | 24,623 |       
|Payroll and related costs                               |       |                | 8,327  |        |      |   | 8,975  |       
|Bonus, profit sharing and retirement plan contributions |       |                | 6,489  |        |      |   | 5,235  |       
|Interest                                                |       |                | 3,633  |        |      |   | 7,319  |       
|Other                                                   |       |                | 10,163 |        |      |   | 10,477 |       
|                                                        |       |                |        |        |      |  
|                                                        | Total |                | $      | 53,279 |      |   | $      | 56,629 | 
|                                                        |       |                |        |        |      |  



|         |                              
|-------- | -----------------------------
|Note 7  | Asset Retirement Obligations:



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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)








| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 1. Landfills  pursuant to Virginia law, the two
    solid waste management facilities at our Yorktown refinery must
    satisfy closure and post-closure care and financial
    responsibility requirements.                                                                                                                                                                                                                                                                                                                                                                                 
|
| | 2. Crude Pipelines  our right-of-way agreements
    generally require that pipeline properties be returned to their
    original condition when the agreements are no longer in effect.
    This means that the pipeline surface facilities must be
    dismantled and removed and certain site reclamation performed.
    We do not believe these right-of-way agreements will require us
    to remove the underground pipe upon taking the pipeline
    permanently out of service. Regulatory requirements, however,
    may mandate that such out-of-service underground pipe be purged.
|
| | 3. Storage Tanks  we have a legal obligation
    under applicable law to remove certain underground and
    aboveground storage tanks, both on owned property and leased
    property, once they are taken out of service. Under some lease
    arrangements, we also have committed to restore the leased
    property to its original condition.                                                                                                                                                                                                                                           



|                            |  |                   |       |   |                   |   |       |  
|--------------------------- |  | ----------------- | ----- | - | ----------------- | - | ----- | -
|                            |  | December 31, 2004 |       |   | December 31, 2003 |  
|                            |  |                   |       |   |                   |  
|                            |  | (In thousands)    |      
|Liability beginning of year |  | $                 | 2,223 |   |                   | $ | 2,198 |  
|Liabilities incurred        |  |                   | 57    |   |                   |   |      |  
|Liabilities settled         |  |                   | (259  | ) |                   |   | (146  | )
|Accretion expense           |  |                   | 251   |   |                   |   | 171   |  
|                            |  |                   |       |   |                   |  
|Liability end of period     |  | $                 | 2,272 |   |                   | $ | 2,223 |  
|                            |  |                   |       |   |                   |  



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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                         |                                  |             |        |        |       |  
|------------------------ | -------------------------------- | ----------- | ------ | ------ | ----- | -
|Net (loss) as reported   |                                  | $           | (9,267 | )     
|Deduct:                  |                                  |             |        |       
|                         | Accretion expense, net of tax    |             |        | (84    | )    
|                         | Depreciation expense, net of tax |             |        | (79    | )    
|                         |                                  |             |       
|                         | Pro forma net (loss)             |             | $      | (9,430 | )    
|                         |                                  |             |       
|(loss) per common share: |                                  |             |        |       
|                         | Basic:                           |             |        |        |      
|                         |                                  | As reported |        | $      | (1.08 | )
|                         |                                  | Pro forma   |        | $      | (1.10 | )
|                         | Diluted:                         |             |        |        |      
|                         |                                  | As reported |        | $      | (1.08 | )
|                         |                                  | Pro forma   |        | $      | (1.10 | )



|         |                
|-------- | ---------------
|Note 8  | Long-Term Debt:



|                                                                                                                              |          |                |         |         |              |   |         |         | 
|----------------------------------------------------------------------------------------------------------------------------- | -------- | -------------- | ------- | ------- | ------------ | - | ------- | ------- | 
|                                                                                                                              |          | December 31,   |         |         | December 31, |  
|                                                                                                                              |          | 2004           |         |         | 2003         |  
|                                                                                                                              |          |                |         |         |              |  
|                                                                                                                              |          | (In thousands) |        
|11% senior subordinated notes, due 2012, net of unamortized
    discount of $3,635 and $5,288, interest payable semi-annually |          | $              | 145,194 |         |              | $ | 194,712 |        
|9% senior subordinated notes, due 2007, interest payable
    semi-annually                                                    |          |                |        |         |              |   | 150,000 |        
|8% senior subordinated notes, due 2014, net of unamortized
    discount of $2,435, interest payable semi-annually             |          |                | 147,565 |         |              |   |        |        
|Senior secured mortgage loan facility, due 2005, floating
    interest rate, principal and interest payable monthly           |          |                |        |         |              |   | 22,000  |        
|Other                                                                                                                         |          |                |        |         |              |   | 17      |        
|                                                                                                                              |          |                |         |         |              |  
|                                                                                                                              | Subtotal |                |         | 292,759 |              |   |         | 366,729 | 
|Less current portion                                                                                                          |          |                |        |         |              |   | (11,128 | )      
|                                                                                                                              |          |                |         |         |              |  
|                                                                                                                              | Total    |                | $       | 292,759 |              |   | $       | 355,601 | 
|                                                                                                                              |          |                |         |         |              |  





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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


1 4










| |   |                                                   
| | - | --------------------------------------------------
| |  | create liens;                                     
|
| |  | incur or guarantee debt;                          
|
| |  | pay dividends;                                    
|
| |  | repurchase shares of our common stock;            
|
| |  | sell certain assets or subsidiary stock;          
|
| |  | engage in certain mergers;                        
|
| |  | engage in certain transactions with affiliates; or
|
| |  | alter our current line of business.               





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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)












| |   |                                             
| | - | --------------------------------------------
| |  | accounts receivable;                        
|
| |  | inventory;                                  
|
| |  | contracts;                                  
|
| |  | chattel paper;                              
|
| |  | trademarks;                                 
|
| |  | copyrights;                                 
|
| |  | patents;                                    
|
| |  | license rights;                             
|
| |  | deposits; and                               
|
| |  | investment accounts and general intangibles.





| |   |                                                                                          
| | - | -----------------------------------------------------------------------------------------
| |  | incur additional indebtedness;                                                           
|
| |  | create liens;                                                                            
|
| |  | dispose of assets;                                                                       
|
| |  | consolidate or merge;                                                                    
|
| |  | make loans and investments;                                                              
|
| |  | enter into transactions with affiliates;                                                 
|
| |  | use loan proceeds for certain purposes;                                                  
|
| |  | guarantee obligations and incur contingent obligations;                                  
|
| |  | enter into agreements restricting the ability of subsidiaries to
    pay dividends to us;
|
| |  | make distributions or stock repurchases;                                                 
|
| |  | make significant changes in accounting practices or change our
    fiscal year; and      
|
| |  | prepay or modify subordinated indebtedness.                                              

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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)












|         |                                            
|-------- | -------------------------------------------
|Note 9  | Financial Instruments and Hedging Activity:





|                                       |                           |                |   |         |            |  |   |          |  |  |            |         |  |  |   |         | 
|-------------------------------------- | ------------------------- | -------------- | - | ------- | ---------- |  | - | -------- |  |  | ---------- | ------- |  |  | - | ------- | 
|                                       |                           | December 31,   |  
|                                       |                           |                |  
|                                       |                           | 2004           |   |         | 2003       | 
|                                       |                           |                |   |         |            | 
|                                       |                           | Carrying       |   |         | Estimated  |  |   | Carrying |  |  | Estimated  |        
|                                       |                           | Amount         |   |         | Fair Value |  |   | Amount   |  |  | Fair Value |        
|                                       |                           |                |   |         |            |  |   |          |  |  |            |        
|                                       |                           | (In thousands) |  
|Balance Sheet  Financial Instruments: |                           |                |   |         |            |  |   |          |  |  |            |         |  |  |   |        
|                                       | Fixed rate long-term debt |                | $ | 292,759 |            |  | $ | 329,392  |  |  | $          | 344,729 |  |  | $ | 372,516 | 







| |                   
| | ------------------
| | Hedging Activities





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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)








|          |                       
|--------- | ----------------------
|Note 10  | Stock Incentive Plans:















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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                    |           |        |         |                  |                |   |       |       | 
|----------------------------------- | --------- | ------ | ------- | ---------------- | -------------- | - | ----- | ----- | 
|                                    |           |        |         | Weighted Average |               
|Options Outstanding At              |           | Shares |         |                  | Exercise Price |  
|                                    |           |        |         |                  |                |  
|January 1, 2002                     |           |        | 398,950 |                  |                | $ | 10.65 |      
|                                    | Granted   |        |         | 171,000          |                |   |       | 2.85  | 
|                                    | Exercised |        |         | (17,900          | )              |   |       | 5.25  | 
|                                    |           |        |         |                  |                |  
|December 31, 2002                   |           |        | 552,050 |                  |                |   | 8.41  |      
|                                    | Granted   |        |         | 140,500          |                |   |       | 5.24  | 
|                                    | Expired   |        |         | (103,550         | )              |   |       | 8.36  | 
|                                    | Forfeited |        |         | (65,000          | )              |   |       | 6.35  | 
|                                    |           |        |         |                  |                |  
|December 31, 2003                   |           |        | 524,000 |                  |                |   | 7.83  |      
|                                    | Exercised |        |         | (215,750         | )              |   |       | 6.72  | 
|                                    | Forfeited |        |         | (2,500           | )              |   |       | 2.85  | 
|                                    |           |        |         |                  |                |  
|December 31, 2004                   |           |        | 305,750 |                  |                | $ | 8.65  |      
|                                    |           |        |         |                  |                |  
|Options exercisable at December 31: |           |        |         |                  |                |   |       |      
|                                    | 2004      |        |         | 235,500          |                |   | $     | 9.67  | 
|                                    | 2003      |        |         | 314,500          |                |   |       | 10.08 | 
|                                    | 2002      |        |         | 321,876          |                |   |       | 11.08 | 



|                         |      |             |                     |        |                  |  |           |             |  |  |                |        |  |   |       |      | 
|------------------------ | ---- | ----------- | ------------------- | ------ | ---------------- |  | --------- | ----------- |  |  | -------------- | ------ |  | - | ----- | ---- | 
|Options Outstanding      |      |             |                    
|                         |      |             | Options Exercisable |       
|                         |      | Weighted    |                     |        |                  | 
|                         |      | Average     |                     |        |                  |  | Weighted  |            
|                         |      | Number      |                     |        | Remaining        |  |           | Number      |  |  | Average        |       
|Range of Exercise Prices |      | Outstanding |                     |        | Contractual Life |  |           | Exercisable |  |  | Exercise Price |       
|                         |      |             |                     |        |                  |  |           |             |  |  |                |       
|$12.00 to 18.50          |      |             | 100,000             |        |                  |  | 2.9 years |             |  |  | 100,000        |        |  | $ | 15.25 |     
|                         | 9.95 |             |                     | 44,000 |                  |  |           | 6.4 years   |  |  |                | 44,000 |  |   |       | 9.95 | 
|                         | 2.85 |             |                     | 69,000 |                  |  |           | 7.9 years   |  |  |                | 69,000 |  |   |       | 2.85 | 
|                         | 5.24 |             |                     | 92,750 |                  |  |           | 8.4 years   |  |  |                | 22,500 |  |   |       | 5.24 | 
|                         |      |             |                     |        |                  |  |           |             |  |  |                |       
|                         |      |             | 305,750             |        |                  |  | 6.2 years |             |  |  | 235,500        |        |  | $ | 9.67  |     
|                         |      |             |                     |        |                  |  |           |             |  |  |                |       



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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                        |  |      |     |   |      |  |     |  
|----------------------- |  | ---- | --- | - | ---- |  | --- | -
|                        |  | 2003 |     |   | 2002 | 
|                        |  |      |     |   |      | 
|Expected life in years  |  |      | 7   |   |      |  | 7   |  
|Risk-free interest rate |  |      | 3.6 | % |      |  | 4.0 | %
|Volatility              |  |      | 60  | % |      |  | 61  | %
|Dividend Yield          |  |      |    |   |      |  |    |  





|          |                                             
|--------- | --------------------------------------------
|Note 11  | Interest, Operating Leases and Rent Expense:







|                                |  |                  |        | 
|------------------------------- |  | ---------------- | ------ | 
|                                |  | Land, Building,  |       
|                                |  | Machinery and    |       
|                                |  | Equipment Leases |       
|                                |  |                  |       
|                                |  | (In thousands)   |       
|2005                            |  | $                | 6,209  | 
|2006                            |  |                  | 5,294  | 
|2007                            |  |                  | 4,469  | 
|2008                            |  |                  | 3,662  | 
|2009                            |  |                  | 3,212  | 
|2010  2025                     |  |                  | 16,158 | 
|                                |  |                  |       
|Total minimum payments required |  | $                | 39,004 | 
|                                |  |                  |       







|          |              
|--------- | -------------
|Note 12  | 401(k) Plans:



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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)












|          |                                      
|--------- | -------------------------------------
|Note 13  | Pension and Post-Retirement Benefits:





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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






| |   |                               
| | - | ------------------------------
| |  | equity securities: 50-70%; and
|
| |  | debt securities: 30-50%       









|                                      |                                                |                   |   |            |                      |  |   |            |   |  |      |           |   |  |   |           | 
|------------------------------------- | ---------------------------------------------- | ----------------- | - | ---------- | -------------------- |  | - | ---------- | - |  | ---- | --------- | - |  | - | --------- | 
|                                      |                                                | Cash Balance Plan |   |            | Retiree Medical Plan | 
|                                      |                                                |                   |   |            |                      | 
|                                      |                                                | 2004              |   |            | 2003                 |  |   | 2004       |   |  | 2003 |          
|                                      |                                                |                   |   |            |                      |  |   |            |   |  |      |          
|Reconciliation of benefit obligation: |                                                |                   |   |            |                      |  |   |            |   |  |      |           |   |  |   |          
|                                      | Benefit obligation at beginning of year        |                   | $ | 10,811,793 |                      |  | $ | 8,550,561  |   |  | $    | 3,363,229 |   |  | $ | 2,498,637 | 
|                                      | Service cost                                   |                   |   | 1,380,020  |                      |  |   | 1,151,983  |   |  |      | 207,573   |   |  |   | 192,379   | 
|                                      | Interest cost                                  |                   |   | 537,174    |                      |  |   | 530,955    |   |  |      | 194,693   |   |  |   | 177,612   | 
|                                      | Benefit paid                                   |                   |   | (68,729    | )                    |  |   | (46,361    | ) |  |      |          |   |  |   |          | 
|                                      | Actuarial (gain) loss                          |                   |   | (919,370   | )                    |  |   | 624,655    |   |  |      | (111,900  | ) |  |   | 494,601   | 
|                                      | Plan amendments                                |                   |   |           |                      |  |   |           |   |  |      |          |   |  |   |          | 
|                                      | Acquisitions                                   |                   |   |           |                      |  |   |           |   |  |      |          |   |  |   |          | 
|                                      |                                                |                   |   |            |                      |  |   |            |   |  |      |          
|                                      | Benefit obligation at year end                 |                   | $ | 11,740,888 |                      |  | $ | 10,811,793 |   |  | $    | 3,653,595 |   |  | $ | 3,363,229 | 
|                                      |                                                |                   |   |            |                      |  |   |            |   |  |      |          
|Reconciliation of plan assets:        |                                                |                   |   |            |                      |  |   |            |   |  |      |           |   |  |   |          
|                                      | Fair value of plan assets at beginning of year |                   | $ | 1,087,345  |                      |  | $ |           |   |  | $    |          |   |  | $ |          | 
|                                      | Actual return on plan assets                   |                   |   | 236,532    |                      |  |   | 47,706     |   |  |      |          |   |  |   |          | 
|                                      | Employer contributions                         |                   |   | 1,828,255  |                      |  |   | 1,086,000  |   |  |      |          |   |  |   |          | 
|                                      | Benefits paid                                  |                   |   | (68,729    | )                    |  |   | (46,361    | ) |  |      |          |   |  |   |          | 
|                                      | Acquisitions                                   |                   |   |           |                      |  |   |           |   |  |      |          |   |  |   |          | 
|                                      |                                                |                   |   |            |                      |  |   |            |   |  |      |          
|                                      | Fair value of plan assets at end of year       |                   | $ | 3,083,403  |                      |  | $ | 1,087,345  |   |  | $    |          |   |  | $ |          | 
|                                      |                                                |                   |   |            |                      |  |   |            |   |  |      |          

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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


|                                                                                                                                 |                                      |                   |            |           |                      |   |            |           |   |   |            |         |  |   |            |         | 
|-------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------ | ----------------- | ---------- | --------- | -------------------- | - | ---------- | --------- | - | - | ---------- | ------- |  | - | ---------- | ------- | 
|                                                                                                                                 |                                      | Cash Balance Plan |            |           | Retiree Medical Plan |  
|                                                                                                                                 |                                      |                   |            |           |                      |  
|                                                                                                                                 |                                      | 2004              |            |           | 2003                 |   |            | 2004      |   |   | 2003       |        
|                                                                                                                                 |                                      |                   |            |           |                      |   |            |           |   |   |            |        
|Unfunded status                                                                                                                  |                                      | $                 | (8,657,485 | )         |                      | $ | (9,724,448 | )         |   | $ | (3,653,595 | )       |  | $ | (3,363,229 | )      
|Unrecognized net transition obligation                                                                                           |                                      |                   |           |           |                      |   |           |           |   |   |           |         |  |   |           |        
|Unrecognized net prior service cost                                                                                              |                                      |                   |           |           |                      |   |           |           |   |   |           |         |  |   |           |        
|Unrecognized net (gain) loss                                                                                                     |                                      |                   | (32,750    | )         |                      |   | 1,001,853  |           |   |   | 517,720    |         |  |   | 647,114    |        
|                                                                                                                                 |                                      |                   |            |           |                      |   |            |           |   |   |            |        
|Accrued benefit cost(a)                                                                                                          |                                      | $                 | (8,690,235 | )         |                      | $ | (8,722,595 | )         |   | $ | (3,135,875 | )       |  | $ | (2,716,115 | )      
|                                                                                                                                 |                                      |                   |            |           |                      |   |            |           |   |   |            |        
|(a) The amounts are reflected in Other Liabilities
    and Deferred Income in the accompanying Consolidated
    Balance Sheets |                                      |                   |            |           |                      |   |            |           |   |   |            |         |  |   |            |        
|Net periodic benefit cost included the following:                                                                                |                                      |                   |            |           |                      |   |            |           |   |   |            |         |  |   |            |        
|                                                                                                                                 | Service cost                         |                   | $          | 1,380,020 |                      |   | $          | 1,151,983 |   |   | $          | 207,573 |  |   | $          | 192,379 | 
|                                                                                                                                 | Interest cost                        |                   |            | 537,174   |                      |   |            | 530,955   |   |   |            | 194,693 |  |   |            | 177,612 | 
|                                                                                                                                 | Expected return on assets            |                   |            | (121,299  | )                    |   |            | (23,563   | ) |   |            |        |  |   |            |        | 
|                                                                                                                                 | Amortization of prior service cost   |                   |            |          |                      |   |            |          |   |   |            |        |  |   |            |        | 
|                                                                                                                                 | Recognized net actuarial (gain)/loss |                   |            |          |                      |   |            |          |   |   |            | 17,494  |  |   |            | 10,147  | 
|                                                                                                                                 |                                      |                   |            |           |                      |   |            |           |   |   |            |        
|                                                                                                                                 | Net periodic benefit cost            |                   | $          | 1,795,895 |                      |   | $          | 1,659,375 |   |   | $          | 419,760 |  |   | $          | 380,138 | 
|                                                                                                                                 |                                      |                   |            |           |                      |   |            |           |   |   |            |        





| |                                  
| | ---------------------------------
| | Weighted Average Plan Assumptions

|                                                                                                          |                                |                   |  |            |                      |  |  |            |   |  |      |            |   |  |  |            |  
|--------------------------------------------------------------------------------------------------------- | ------------------------------ | ----------------- |  | ---------- | -------------------- |  |  | ---------- | - |  | ---- | ---------- | - |  |  | ---------- | -
|                                                                                                          |                                | Cash Balance Plan |  |            | Retiree Medical Plan | 
|                                                                                                          |                                |                   |  |            |                      | 
|                                                                                                          |                                | 2004              |  |            | 2003                 |  |  | 2004       |   |  | 2003 |           
|                                                                                                          |                                |                   |  |            |                      |  |  |            |   |  |      |           
|Weighted average assumptions used to determine benefit
    obligations at December 31:                    |                                |                   |  |            |                      |  |  |            |   |  |      |            |   |  |  |           
|                                                                                                          | Measurement date               |                   |  | 12/31/2004 |                      |  |  | 12/31/2003 |   |  |      | 12/31/2004 |   |  |  | 12/31/2003 |  
|                                                                                                          | Discount rate                  |                   |  | 5.50       | %                    |  |  | 6.00       | % |  |      | 6.00       | % |  |  | 6.00       | %
|                                                                                                          | Rate of compensation increase* |                   |  | 4.00       | %                    |  |  | 4.00       | % |  |      |           |   |  |  |           |  
|Weighted average assumptions used to determine net periodic
    benefit cost for years ended December 31: |                                |                   |  |            |                      |  |  |            |   |  |      |            |   |  |  |           
|                                                                                                          | Discount rate                  |                   |  | 6.00       | %                    |  |  | 6.50       | % |  |      | 6.00       | % |  |  | 6.50       | %
|                                                                                                          | Expected return on assets      |                   |  | 8.50       | %                    |  |  | 8.50       | % |  |      |           |   |  |  |           |  
|                                                                                                          | Rate of compensation increase* |                   |  | 4.00       | %                    |  |  | 4.00       | % |  |      |           |   |  |  |           |  






|  |                                                                                                                                                                                                                                                     
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|* | Salary increases are assumed to increase at a rate of
    4% per year. An additional 5% increase is added to the
    ultimate rate for those with less than one year of service
    grading down to 0% once a participant has five years of service.



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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






| |            
| | -----------
| | Plan Assets



|                  |       |                |    |     |      |  |    |     |  
|----------------- | ----- | -------------- | -- | --- | ---- |  | -- | --- | -
|                  |       | Percentage of  |   
|                  |       | Plan Assets at |   
|                  |       | December 31,   |   
|                  |       |                |   
|Asset Category    |       | 2004           |    |     | 2003 | 
|                  |       |                |    |     |      | 
|Equity securities |       |                | 70 | %   |      |  | 71 | %  
|Debt securities   |       |                | 27 | %   |      |  | 29 | %  
|Real estate       |       |                | 0  | %   |      |  | 0  | %  
|Other             |       |                | 3  | %   |      |  | 0  | %  
|                  |       |                |    |     |      | 
|                  | Total |                |    | 100 | %    |  |    | 100 | %
|                  |       |                |    |     |      | 



| |                                     
| | ------------------------------------
| | Assumed Health Care Cost Trend Rates

|                                                     |                                                                                       |                 |  |      |       |   |  |      |       |  
|---------------------------------------------------- | ------------------------------------------------------------------------------------- | --------------- |  | ---- | ----- | - |  | ---- | ----- | -
|                                                     |                                                                                       | Retiree Medical | 
|                                                     |                                                                                       | Plan            | 
|                                                     |                                                                                       |                 | 
|                                                     |                                                                                       | 2004            |  |      | 2003  |  
|                                                     |                                                                                       |                 |  |      |       |  
|Assumed health care cost trend rates at December 31: |                                                                                       |                 |  |      |       |   |  |     
|                                                     | Health care cost trend rate assumed for next year:                                    |                 |  |      |       |   |  |      |      
|                                                     |                                                                                       | HMO             |  |      | 9.50  | % |  |      | 10.50 | %
|                                                     |                                                                                       | Pre-65 Non-HMO  |  |      | 11.50 | % |  |      | 12.50 | %
|                                                     |                                                                                       | Post-65 Non-HMO |  |      | 13.00 | % |  |      | 14.50 | %
|                                                     | Rate to which the cost trend rate is assumed to decline (the
    ultimate trend rate) |                 |  | 4.50 | %     |   |  | 4.50 | %    
|                                                     | Year that the rate reaches the ultimate trend rate                                    |                 |  | 2012 |       |   |  | 2012 |      



|                                                        |  |          |        |  |          |   |         |  
|------------------------------------------------------- |  | -------- | ------ |  | -------- | - | ------- | -
|                                                        |  | 1%-Point |       
|                                                        |  |          |       
|                                                        |  | Increase |        |  | Decrease |  
|                                                        |  |          |        |  |          |  
|Effect on total of service and interest cost components |  | $        | 7,510  |  |          | $ | (6,738  | )
|Effect on postretirement benefit obligation             |  |          | 64,678 |  |          |   | (64,298 | )

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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|          |              
|--------- | -------------
|Note 14  | Income Taxes:



|                                                     |         |                         |        |        |      |   |       |       |   |   |        |        |  
|---------------------------------------------------- | ------- | ----------------------- | ------ | ------ | ---- | - | ----- | ----- | - | - | ------ | ------ | -
|                                                     |         | Year Ended December 31, |       
|                                                     |         |                         |       
|                                                     |         | 2004                    |        |        | 2003 |   |       | 2002  |  
|                                                     |         |                         |        |        |      |   |       |       |  
|                                                     |         | (In thousands)          |       
|Current:                                             |         |                         |        |        |      |   |       |       |   |   |        |       
|                                                     | Federal |                         | $      | 3,172  |      |   | $     | (32   | ) |   | $      | (6,655 | )
|                                                     | State   |                         |        | (1,082 | )    |   |       | (3    | ) |   |        | (1,130 | )
|                                                     |         |                         |        |        |      |   |       |       |  
|                                                     |         |                         | 2,090  |        |      |   | (35   | )     |   |   | (7,785 | )     
|                                                     |         |                         |        |        |      |   |       |       |  
|Deferred:                                            |         |                         |        |        |      |   |       |       |   |   |        |       
|                                                     | Federal |                         |        | 6,001  |      |   |       | 8,391 |   |   |        | (796   | )
|                                                     | State   |                         |        | 2,564  |      |   |       | (420  | ) |   |        | 927    |  
|                                                     |         |                         |        |        |      |   |       |       |  
|                                                     |         |                         | 8,565  |        |      |   | 7,971 |       |   |   | 131    |       
|                                                     |         |                         |        |        |      |   |       |       |  
|Total provision (benefit) from continuing operations |         | $                       | 10,655 |        |      | $ | 7,936 |       |   | $ | (7,654 | )     
|                                                     |         |                         |        |        |      |   |       |       |  







|                                                                      |                                     |                         |        |     |      |   |       |      |   |   |        |      |  
|--------------------------------------------------------------------- | ----------------------------------- | ----------------------- | ------ | --- | ---- | - | ----- | ---- | - | - | ------ | ---- | -
|                                                                      |                                     | Year Ended December 31, |       
|                                                                      |                                     |                         |       
|                                                                      |                                     | 2004                    |        |     | 2003 |   |       | 2002 |  
|                                                                      |                                     |                         |        |     |      |   |       |      |  
|                                                                      |                                     | (In thousands)          |       
|Income taxes at the statutory U.S. federal income tax rate
    of 35% |                                     | $                       | 9,431  |     |      | $ | 7,087 |      |   | $ | (6,711 | )   
|Increase (decrease) in taxes resulting from:                          |                                     |                         |        |     |      |   |       |      |   |   |        |     
|                                                                      | State taxes, net                    |                         |        | 963 |      |   |       | (275 | ) |   |        | (132 | )
|                                                                      | Loss of nonconventional fuel credit |                         |        |    |      |   |       | 581  |   |   |        |     |  
|                                                                      | Other, net                          |                         |        | 261 |      |   |       | 543  |   |   |        | (811 | )
|                                                                      |                                     |                         |        |     |      |   |       |      |  
|Total provision (benefit) from continuing operations                  |                                     | $                       | 10,655 |     |      | $ | 7,936 |      |   | $ | (7,654 | )   
|                                                                      |                                     |                         |        |     |      |   |       |      |  

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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                     |                                    |                                        |                       |   |                   |        |   |       |         |         |        |   |         |             |        |   |       |        |   |   |         |         |        |   |         |         |  
|------------------------------------ | ---------------------------------- | -------------------------------------- | --------------------- | - | ----------------- | ------ | - | ----- | ------- | ------- | ------ | - | ------- | ----------- | ------ | - | ----- | ------ | - | - | ------- | ------- | ------ | - | ------- | ------- | -
|                                     |                                    | December 31, 2004                      |                       |   | December 31, 2003 |       
|                                     |                                    |                                        |                       |   |                   |       
|                                     |                                    | Assets                                 |                       |   | Liabilities       |        |   | Total |         |         | Assets |   |         | Liabilities |        |   | Total |       
|                                     |                                    |                                        |                       |   |                   |        |   |       |         |         |        |   |         |             |        |   |       |       
|                                     |                                    | (In thousands)                         |                      
|Deferred Tax Assets and Liabilities: |                                    |                                        |                       |   |                   |        |   |       |         |         |        |   |         |             |        |   |       |        |   |   |         |         |        |  
|                                     | Current Assets and Liabilities:    |                                        |                       |   |                   |        |   |       |         |         |        |   |         |             |        |   |       |        |   |   |         |         |        |   |        
|                                     |                                    | Accounts receivable                    |                       | $ | 67                |        |   | $     |        |         |        | $ | 67      |             |        | $ | 84    |        |   | $ |        |         |        | $ | 84      |        
|                                     |                                    | Insurance accruals                     |                       |   | 801               |        |   |       |        |         |        |   | 801     |             |        |   | 939   |        |   |   |        |         |        |   | 939     |        
|                                     |                                    | Vacation accruals                      |                       |   | 1,429             |        |   |       |        |         |        |   | 1,429   |             |        |   | 1,195 |        |   |   |        |         |        |   | 1,195   |        
|                                     |                                    | Other reserves                         |                       |   | 559               |        |   |       |        |         |        |   | 559     |             |        |   | 1,508 |        |   |   |        |         |        |   | 1,508   |        
|                                     |                                    | Other accruals                         |                       |   |                  |        |   |       | (3,174  | )       |        |   | (3,174  | )           |        |   |      |        |   |   |        |         |        |   |        |        
|                                     |                                    |                                        | Inventory adjustments |   |                   | 2,152  |   |       |         |        |        |   |         | 2,152       |        |   |       |       |   |   |         | (7,079  | )      |   |         | (7,079  | )
|                                     |                                    |                                        |                       |   |                   |        |   |       |         |         |        |   |         |             |        |   |       |       
|                                     |                                    |                                        | Total current         |   |                   | 5,008  |   |       |         | (3,174  | )      |   |         | 1,834       |        |   |       | 3,726  |   |   |         | (7,079  | )      |   |         | (3,353  | )
|                                     |                                    |                                        |                       |   |                   |        |   |       |         |         |        |   |         |             |        |   |       |       
|                                     | Noncurrent Assets and Liabilities: |                                        |                       |   |                   |        |   |       |         |         |        |   |         |             |        |   |       |        |   |   |         |         |        |   |        
|                                     |                                    | Other accruals                         |                       |   | 831               |        |   |       | (192    | )       |        |   | 639     |             |        |   | 561   |        |   |   | (290    | )       |        |   | 271     |        
|                                     |                                    | Accrued retirement                     |                       |   | 4,310             |        |   |       |        |         |        |   | 4,310   |             |        |   | 3,900 |        |   |   |        |         |        |   | 3,900   |        
|                                     |                                    | Deductible repairs and amount financed |                       |   |                  |        |   |       | (3,150  | )       |        |   | (3,150  | )           |        |   |      |        |   |   | (702    | )       |        |   | (702    | )      
|                                     |                                    | Accelerated depreciation               |                       |   |                  |        |   |       | (64,701 | )       |        |   | (64,701 | )           |        |   |      |        |   |   | (52,520 | )       |        |   | (52,520 | )      
|Net operating loss carryforward      |                                    |                                        | 5,821                 |   |                   |        |  |       |         |         | 5,821  |   |         |             | 7,136  |   |       |        |  |   |         |         | 7,136  |  
|Tax credit carryforwards             |                                    |                                        | 16,042                |   |                   |        |  |       |         |         | 16,042 |   |         |             | 13,876 |   |       |        |  |   |         |         | 13,876 |  
|                                     |                                    |                                        |                       |   |                   |        |   |       |         |         |        |   |         |             |        |   |       |       
|                                     |                                    |                                        | Total noncurrent      |   |                   | 27,004 |   |       |         | (68,043 | )      |   |         | (41,039     | )      |   |       | 25,473 |   |   |         | (53,512 | )      |   |         | (28,039 | )
|                                     |                                    |                                        |                       |   |                   |        |   |       |         |         |        |   |         |             |        |   |       |       
|                                     |                                    |                                        | Total                 |   | $                 | 32,012 |   |       | $       | (71,217 | )      |   | $       | (39,205     | )      |   | $     | 29,199 |   |   | $       | (60,591 | )      |   | $       | (31,392 | )
|                                     |                                    |                                        |                       |   |                   |        |   |       |         |         |        |   |         |             |        |   |       |       





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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|          |                    
|--------- | -------------------
|Note 15  | Earnings Per Share:



|                                                    |  |                         |        |   |      |   |        |      |  |   |         |  
|--------------------------------------------------- |  | ----------------------- | ------ | - | ---- | - | ------ | ---- |  | - | ------- | -
|                                                    |  | Year Ended December 31, |       
|                                                    |  |                         |       
|Numerator                                           |  | 2004                    |        |   | 2003 |   |        | 2002 | 
|                                                    |  |                         |        |   |      |   |        |      | 
|                                                    |  | (In thousands)          |       
|Earnings (loss) from continuing operations          |  | $                       | 16,292 |   |      | $ | 12,312 |      |  | $ | (11,520 | )
|Earnings (loss) from discontinued operations        |  |                         | (71    | ) |      |   | (389   | )    |  |   | 2,253   |  
|Cumulative effect of change in accounting principle |  |                         |       |   |      |   | (704   | )    |  |   |        |  
|                                                    |  |                         |        |   |      |   |        |      | 
|Net earnings (loss)                                 |  | $                       | 16,221 |   |      | $ | 11,219 |      |  | $ | (9,267  | )
|                                                    |  |                         |        |   |      |   |        |      | 

|                                              |  |                         |            |  |      |  |           |      |  |  |           |  
|--------------------------------------------- |  | ----------------------- | ---------- |  | ---- |  | --------- | ---- |  |  | --------- | -
|                                              |  | Year Ended December 31, |           
|                                              |  |                         |           
|Denominator                                   |  | 2004                    |            |  | 2003 |  |           | 2002 | 
|                                              |  |                         |            |  |      |  |           |      | 
|Basic  weighted average shares outstanding   |  |                         | 11,104,938 |  |      |  | 8,731,672 |      |  |  | 8,565,992 |  
|Effective of dilutive stock options           |  |                         | 253,360    |  |      |  | 98,692    |      |  |  |          | *
|                                              |  |                         |            |  |      |  |           |      | 
|Diluted  weighted average shares outstanding |  |                         | 11,358,298 |  |      |  | 8,830,364 |      |  |  | 8,565,992 |  
|                                              |  |                         |            |  |      |  |           |      | 






|  |                                                                           
|- | --------------------------------------------------------------------------
|* | The additional 8,650 shares would be antidilutive due to
    the net loss.

|                                                    |  |                         |       |   |      |   |       |      |  |   |       |  
|--------------------------------------------------- |  | ----------------------- | ----- | - | ---- | - | ----- | ---- |  | - | ----- | -
|                                                    |  | Year Ended December 31, |      
|                                                    |  |                         |      
|Basic Earnings Per Share                            |  | 2004                    |       |   | 2003 |   |       | 2002 | 
|                                                    |  |                         |       |   |      |   |       |      | 
|Earnings (loss) from continuing operations          |  | $                       | 1.47  |   |      | $ | 1.41  |      |  | $ | (1.34 | )
|Earnings (loss) from discontinued operations        |  |                         | (0.01 | ) |      |   | (0.05 | )    |  |   | 0.26  |  
|Cumulative effect of change in accounting principle |  |                         |      |   |      |   | (0.08 | )    |  |   |      |  
|                                                    |  |                         |       |   |      |   |       |      | 
|Net earnings (loss)                                 |  | $                       | 1.46  |   |      | $ | 1.28  |      |  | $ | (1.08 | )
|                                                    |  |                         |       |   |      |   |       |      | 

|                                                    |  |                         |       |   |      |   |       |      |  |   |       |  
|--------------------------------------------------- |  | ----------------------- | ----- | - | ---- | - | ----- | ---- |  | - | ----- | -
|                                                    |  | Year Ended December 31, |      
|                                                    |  |                         |      
|Diluted Earnings Per Share                          |  | 2004                    |       |   | 2003 |   |       | 2002 | 
|                                                    |  |                         |       |   |      |   |       |      | 
|Earnings (loss) from continuing operations          |  | $                       | 1.43  |   |      | $ | 1.40  |      |  | $ | (1.34 | )
|Earnings (loss) from discontinued operations        |  |                         | (0.01 | ) |      |   | (0.05 | )    |  |   | 0.26  |  
|Cumulative effect of change in accounting principle |  |                         |      |   |      |   | (0.08 | )    |  |   |      |  
|                                                    |  |                         |       |   |      |   |       |      | 
|Net earnings (loss)                                 |  | $                       | 1.42  |   |      | $ | 1.27  |      |  | $ | (1.08 | )
|                                                    |  |                         |       |   |      |   |       |      | 







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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






|          |                   
|--------- | ------------------
|Note 16  | Business Segments:





| |               
| | --------------
| | Refining Group





| |             
| | ------------
| | Retail Group





| |             
| | ------------
| | Phoenix Fuel





| |      
| | -----
| | Other







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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |         |   |           | 
|-------------------------------------------------------- | -------------------------------------------------- | ---------------------------------------------- | --------------------------------------------------------- | ------- | --------- | --------- | ------- | ------- | - | ------- | ------- | ------ | ----------- | ------- | ------ | ------ | ------------ | ------- | -------- | -------- | - | -------- | --------- | ------- | - | --------- | 
|                                                         |                                                    | As of and For the Year Ended December 31, 2004 |                                                          
|                                                         |                                                    |                                                |                                                          
|                                                         |                                                    | Refining                                       |                                                           |         | Retail    |           |         | Phoenix |   |         |         |        | Reconciling |         |        |       
|                                                         |                                                    | Group                                          |                                                           |         | Group     |           |         | Fuel    |   |         | Other   |        |             | Items   |        |        | Consolidated |        
|                                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |        
|                                                         |                                                    | (In thousands)                                 |                                                          
|Customer net revenues:                                   |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |        
|                                                         | Finished products:                                 |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |         |  
|                                                         |                                                    | Four Corners operations                        |                                                           | $       | 423,397   |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |         |   |          
|                                                         |                                                    | Yorktown operations                            |                                                           |         | 1,006,068 |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |         |   |          
|                                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |        
|                                                         |                                                    |                                                | Total                                                     |         | $         | 1,429,465 |         |         | $ | 233,984 |         |        | $           | 584,903 |        |        | $            |        |          |          | $ |         |           |         | $ | 2,248,352 | 
|                                                         | Merchandise and lubricants                         |                                                |                                                           |        |           |           |         | 134,296 |   |         |         | 32,510 |             |         |        |       |              |         |          |         |   |          |           | 166,806 |  
|                                                         | Other                                              |                                                |                                                           | 80,311  |           |           |         | 15,176  |   |         |         | 1,684  |             |         |        | 529    |              |         |          |         |   |          |           | 97,700  |  
|                                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |        
|                                                         |                                                    |                                                | Total                                                     |         |           | 1,509,776 |         |         |   | 383,456 |         |        |             | 619,097 |        |        |              | 529     |          |          |   |         |           |         |   | 2,512,858 | 
|                                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |        
|Intersegment net revenues:                               |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |        
|                                                         | Finished products                                  |                                                |                                                           | 205,842 |           |           |         |        |   |         |         | 61,478 |             |         |        |       |              |         |          | (267,320 | ) |          |           |        |  
|                                                         | Other                                              |                                                |                                                           | 15,652  |           |           |         |        |   |         |         |       |             |         |        |       |              |         |          | (15,652  | ) |          |           |        |  
|                                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |        
|                                                         |                                                    |                                                | Total                                                     |         |           | 221,494   |         |         |   |        |         |        |             | 61,478  |        |        |              |        |          |          |   | (282,972 | )         |         |   |          | 
|                                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |        
|Total net revenues                                       |                                                    |                                                | 1,731,270                                                 |         |           |           | 383,456 |         |   |         | 680,575 |        |             |         | 529    |        |              |         | (282,972 | )        |   |          | 2,512,858 |        
|Less net revenues of discontinued operations             |                                                    |                                                |                                                          |         |           |           | (853    | )       |   |         |        |        |             |         |       |        |              |         |         |          |   |          | (853      | )      
|                                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |        
|Net revenues of continuing operations                    |                                                    | $                                              | 1,731,270                                                 |         |           | $         | 382,603 |         |   | $       | 680,575 |        |             | $       | 529    |        |              | $       | (282,972 | )        |   | $        | 2,512,005 |        
|                                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |        
|Operating income (loss):                                 |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |        
|                                                         | Four Corners operations                            |                                                | $                                                         | 30,914  |           |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |         |  
|                                                         | Yorktown operations                                |                                                |                                                           | 52,752  |           |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |         |  
|                                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |        
|                                                         |                                                    |                                                | Total operating income (loss) before corporate allocation |         | $         | 83,666    |         |         | $ | 6,688   |         |        | $           | 10,486  |        |        | $            | (26,325 | )        |          | $ | 3,775    |           |         | $ | 78,290    | 
|Corporate allocation                                     |                                                    |                                                | (13,069                                                   | )       |           |           | (7,804  | )       |   |         | (2,388  | )      |             |         | 23,261 |        |              |         |         |          |   |          |          |        
|                                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |        
|Total operating income (loss) after corporate allocation |                                                    |                                                | 70,597                                                    |         |           |           | (1,116  | )       |   |         | 8,098   |        |             |         | (3,064 | )      |              |         | 3,775    |          |   |          | 78,290    |        
|                                                         | Discontinued operations loss/(gain)                |                                                |                                                           |        |           |           |         | 143     |   |         |         |       |             |         |        |       |              |         |          | (28      | ) |          |           | 115     |  
|                                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |        
|                                                         | Operating income (loss) from continuing operations |                                                | $                                                         | 70,597  |           |           | $       | (973    | ) |         | $       | 8,098  |             |         | $      | (3,064 | )            |         | $        | 3,747    |   |          | $         | 78,405  |  
|                                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |        
|Interest expense                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          | (32,907   | )      
|Costs associated with early debt extinguishment          |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          | (10,564   | )      
|Amortization and write-offs of financing costs           |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          | (8,341    | )      
|Interest and investment income                           |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          | 354       |        
|                                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |        
|Earnings from continuing operations before income taxes  |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   | $        | 26,947    |        
|                                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |        
|Depreciation and amortization:                           |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |        
|                                                         | Four Corners operations                            |                                                | $                                                         | 16,191  |           |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |         |  
|                                                         | Yorktown operations                                |                                                |                                                           | 9,328   |           |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |         |  
|                                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |        
|                                                         |                                                    |                                                | Total                                                     |         | $         | 25,519    |         |         | $ | 9,186   |         |        | $           | 1,614   |        |        | $            | 879     |          |          | $ |         |           |         | $ | 37,198    | 
|                                                         | Less discontinued operations                       |                                                |                                                           |        |           |           |         | (69     | ) |         |         |       |             |         |        |       |              |         |          |         |   |          |           | (69     | )
|                                                         |                                                    |                                                |                                                           |         |           |           |         |         |   |         |         |        |             |         |        |        |              |        
|                                                         | Continuing operations                              |                                                | $                                                         | 25,519  |           |           | $       | 9,117   |   |         | $       | 1,614  |             |         | $      | 879    |              |         | $        |         |   |          | $         | 37,129  |  
|Total assets                                             |                                                    | $                                              | 474,984                                                   |         |           | $         | 103,786 |         |   | $       | 73,467  |        |             | $       | 50,169 |        |              | $       |         |          |   | $        | 702,406   |        
|Capital expenditures                                     |                                                    | $                                              | 50,609                                                    |         |           | $         | 5,835   |         |   | $       | 1,707   |        |             | $       | 520    |        |              | $       |         |          |   | $        | 58,671    |        
|Yorktown refinery acquisition contingent payment         |                                                    | $                                              | 16,146                                                    |         |           | $         |        |         |   | $       |        |        |             | $       |       |        |              | $       |         |          |   | $        | 16,146    |        

78



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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


|                                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |         |   |           | 
|-------------------------------------------------------- | -------------------------------------------------- | ---------------------------------------------- | --------------------------------------------------------- | ------- | ------- | --------- | ------- | ------- | - | ------- | ------- | ------ | ----------- | ------- | ------ | ------ | ------------ | ------- | -------- | -------- | - | -------- | --------- | ------- | - | --------- | 
|                                                         |                                                    | As of and For the Year Ended December 31, 2003 |                                                          
|                                                         |                                                    |                                                |                                                          
|                                                         |                                                    | Refining                                       |                                                           |         | Retail  |           |         | Phoenix |   |         |         |        | Reconciling |         |        |       
|                                                         |                                                    | Group                                          |                                                           |         | Group   |           |         | Fuel    |   |         | Other   |        |             | Items   |        |        | Consolidated |        
|                                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |        
|                                                         |                                                    | (In thousands)                                 |                                                          
|Customer net revenues:                                   |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |        
|                                                         | Finished products:                                 |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |         |  
|                                                         |                                                    | Four Corners operations                        |                                                           | $       | 287,288 |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |         |   |          
|                                                         |                                                    | Yorktown operations                            |                                                           |         | 752,115 |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |         |   |          
|                                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |        
|                                                         |                                                    |                                                | Total                                                     |         | $       | 1,039,403 |         |         | $ | 201,278 |         |        | $           | 397,163 |        |        | $            |        |          |          | $ |         |           |         | $ | 1,637,844 | 
|                                                         | Merchandise and lubricants                         |                                                |                                                           |        |         |           |         | 133,039 |   |         |         | 26,262 |             |         |        |       |              |         |          |         |   |          |           | 159,301 |  
|                                                         | Other                                              |                                                |                                                           | 20,797  |         |           |         | 16,184  |   |         |         | 1,775  |             |         |        | 537    |              |         |          |         |   |          |           | 39,293  |  
|                                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |        
|                                                         |                                                    |                                                | Total                                                     |         |         | 1,060,200 |         |         |   | 350,501 |         |        |             | 425,200 |        |        |              | 537     |          |          |   |         |           |         |   | 1,836,438 | 
|                                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |        
|Intersegment net revenues:                               |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |        
|                                                         | Finished products                                  |                                                |                                                           | 175,898 |         |           |         |        |   |         |         | 47,304 |             |         |        |       |              |         |          | (223,202 | ) |          |           |        |  
|                                                         | Other                                              |                                                |                                                           | 15,862  |         |           |         |        |   |         |         |       |             |         |        |       |              |         |          | (15,862  | ) |          |           |        |  
|                                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |        
|                                                         |                                                    |                                                | Total                                                     |         |         | 191,760   |         |         |   |        |         |        |             | 47,304  |        |        |              |        |          |          |   | (239,064 | )         |         |   |          | 
|                                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |        
|Total net revenues                                       |                                                    |                                                | 1,251,960                                                 |         |         |           | 350,501 |         |   |         | 472,504 |        |             |         | 537    |        |              |         | (239,064 | )        |   |          | 1,836,438 |        
|Less net revenues of discontinued operations             |                                                    |                                                |                                                          |         |         |           | (26,776 | )       |   |         |        |        |             |         |       |        |              |         |         |          |   |          | (26,776   | )      
|                                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |        
|Net revenues of continuing operations                    |                                                    | $                                              | 1,251,960                                                 |         |         | $         | 323,725 |         |   | $       | 472,504 |        |             | $       | 537    |        |              | $       | (239,064 | )        |   | $        | 1,809,662 |        
|                                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |        
|Operating income (loss):                                 |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |        
|                                                         | Four Corners operations                            |                                                | $                                                         | 41,932  |         |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |         |  
|                                                         | Yorktown operations                                |                                                |                                                           | 22,039  |         |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |         |  
|                                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |        
|                                                         |                                                    |                                                | Total operating income (loss) before corporate allocation |         | $       | 63,971    |         |         | $ | 13,476  |         |        | $           | 8,483   |        |        | $            | (20,995 | )        |          | $ | (1,791   | )         |         | $ | 63,144    | 
|Corporate allocation                                     |                                                    |                                                | (10,423                                                   | )       |         |           | (6,224  | )       |   |         | (1,904  | )      |             |         | 18,551 |        |              |         |         |          |   |          |          |        
|                                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |        
|Total operating income (loss) after corporate allocation |                                                    |                                                | 53,548                                                    |         |         |           | 7,252   |         |   |         | 6,579   |        |             |         | (2,444 | )      |              |         | (1,791   | )        |   |          | 63,144    |        
|Discontinued operations loss/(gain)                      |                                                    |                                                |                                                          |         |         |           | 677     |         |   |         |        |        |             |         |       |        |              |         | (46      | )        |   |          | 631       |        
|                                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |        
|                                                         | Operating income (loss) from continuing operations |                                                | $                                                         | 53,548  |         |           | $       | 7,929   |   |         | $       | 6,579  |             |         | $      | (2,444 | )            |         | $        | (1,837   | ) |          | $         | 63,775  |  
|                                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |        
|Interest expense                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          | (38,993   | )      
|Amortization and write-offs of financing costs           |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          | (4,696    | )      
|Interest and investment income                           |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          | 162       |        
|                                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |        
|Earnings from continuing operations before income taxes  |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   | $        | 20,248    |        
|                                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |        
|Depreciation and amortization:                           |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |        
|                                                         | Four Corners operations                            |                                                | $                                                         | 15,846  |         |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |         |  
|                                                         | Yorktown operations                                |                                                |                                                           | 7,951   |         |           |         |         |   |         |         |        |             |         |        |        |              |         |          |          |   |          |           |         |  
|                                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |        
|                                                         |                                                    |                                                | Total                                                     |         | $       | 23,797    |         |         | $ | 10,656  |         |        | $           | 1,763   |        |        | $            | 1,301   |          |          | $ |         |           |         | $ | 37,517    | 
|                                                         | Less discontinued operations                       |                                                |                                                           |        |         |           |         | (630    | ) |         |         |       |             |         |        |       |              |         |          |         |   |          |           | (630    | )
|                                                         |                                                    |                                                |                                                           |         |         |           |         |         |   |         |         |        |             |         |        |        |              |        
|                                                         | Continuing operations                              |                                                | $                                                         | 23,797  |         |           | $       | 10,026  |   |         | $       | 1,763  |             |         | $      | 1,301  |              |         | $        |         |   |          | $         | 36,887  |  
|Total assets                                             |                                                    | $                                              | 459,253                                                   |         |         | $         | 116,083 |         |   | $       | 72,188  |        |             | $       | 52,130 |        |              | $       |         |          |   | $        | 699,654   |        
|Capital expenditures                                     |                                                    | $                                              | 14,428                                                    |         |         | $         | 2,322   |         |   | $       | 295     |        |             | $       | 834    |        |              | $       |         |          |   | $        | 17,879    |        
|Yorktown refinery acquisition contingent payment         |                                                    | $                                              | 8,854                                                     |         |         | $         |        |         |   | $       |        |        |             | $       |       |        |              | $       |         |          |   | $        | 8,854     |        

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##### Table of Contents



GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


|                                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |     |          |          |       |          |           |         |        |           |        | 
|--------------------------------------------------- | ---------------------------------------------------------- | --------------------------------------------------------- | ------- | ------- | ------- | ------- | ------- | ------- | ----- | ------- | ------- | ------ | ----------- | ------- | ------ | ------ | ------------ | --- | -------- | -------- | ----- | -------- | --------- | ------- | ------ | --------- | ------ | 
|                                                    |                                                            | As of and For the Year Ended December 31, 2002            |        
|                                                    |                                                            |                                                           |        
|                                                    |                                                            | Refining                                                  |         |         | Retail  |         |         | Phoenix |       |         |         |        | Reconciling |         |        |       
|                                                    |                                                            | Group                                                     |         |         | Group   |         |         | Fuel    |       |         | Other   |        |             | Items   |        |        | Consolidated |    
|                                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |    
|                                                    |                                                            | (In thousands)                                            |        
|Customer net revenues:                              |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |     |          |          |       |          |           |        
|                                                    | Finished products:                                         |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |     |          |          |       |          |           |         |       
|                                                    |                                                            | Four Corners operations                                   |         | $       | 253,826 |         |         |         |       |         |         |        |             |         |        |        |              |     |          |          |       |          |           |         |        |          
|                                                    |                                                            | Yorktown operations(1)                                    |         |         | 408,936 |         |         |         |       |         |         |        |             |         |        |        |              |     |          |          |       |          |           |         |        |          
|                                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |    
|                                                    |                                                            |                                                           | Total   |         | $       | 662,762 |         |         | $     | 189,008 |         |        | $           | 269,316 |        |        | $            |    |          |          | $     |         |           |         | $      | 1,121,086 |       
|                                                    | Merchandise and lubricants                                 |                                                           |         |        |         |         |         | 141,870 |       |         |         | 23,345 |             |         |        |       |              |     |          |         |       |          |           | 165,215 |       
|                                                    | Other                                                      |                                                           |         | 8,226   |         |         |         | 15,791  |       |         |         | 2,564  |             |         |        | 180    |              |     |          |         |       |          |           | 26,761  |       
|                                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |    
|                                                    |                                                            |                                                           | Total   |         |         | 670,988 |         |         |       | 346,669 |         |        |             | 295,225 |        |        |              | 180 |          |          |       |         |           |         |        | 1,313,062 |       
|                                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |    
|Intersegment net revenues:                          |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |     |          |          |       |          |           |        
|                                                    | Finished products                                          |                                                           |         | 151,189 |         |         |         |        |       |         |         | 54,709 |             |         |        |       |              |     |          | (205,898 | )     |          |           |        |       
|                                                    | Other                                                      |                                                           |         | 16,352  |         |         |         |        |       |         |         |       |             |         |        |       |              |     |          | (16,352  | )     |          |           |        |       
|                                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |    
|                                                    |                                                            |                                                           | Total   |         |         | 167,541 |         |         |       |        |         |        |             | 54,709  |        |        |              |    |          |          |       | (222,250 | )         |         |        |          |       
|                                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |    
|Total net revenues                                  |                                                            |                                                           | 838,529 |         |         |         | 346,669 |         |       |         | 349,934 |        |             |         | 180    |        |              |     | (222,250 | )        |       |          | 1,313,062 |        
|Less net revenues of discontinued operations        |                                                            |                                                           |        |         |         |         | (61,036 | )       |       |         |        |        |             |         |       |        |              |     |         |          |       |          | (61,036   | )      
|                                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |    
|Net revenues of continuing operations               |                                                            | $                                                         | 838,529 |         |         | $       | 285,633 |         |       | $       | 349,934 |        |             | $       | 180    |        |              | $   | (222,250 | )        |       | $        | 1,252,026 |        
|                                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |    
|Operating income (loss):                            |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |     |          |          |       |          |           |        
|                                                    | Four Corners operations                                    |                                                           | $       | 30,822  |         |         |         |         |       |         |         |        |             |         |        |        |              |     |          |          |       |          |           |         |       
|                                                    | Yorktown operations(1)                                     |                                                           |         | (6,388  | )       |         |         |         |       |         |         |        |             |         |        |        |              |     |          |          |       |          |           |         |       
|                                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |    
|                                                    |                                                            | Total operating income (loss) before corporate allocation |         | $       | 24,434  |         |         | $       | 3,249 |         |         | $      | 7,014       |         |        | $      | (16,981      | )   |          | $        | 5,894 |          |           | $       | 23,610 |          
|                                                    | Corporate allocation                                       |                                                           |         | (8,431  | )       |         |         | (5,034  | )     |         |         | (1,540 | )           |         |        | 15,005 |              |     |          |         |       |          |           |        |       
|                                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |    
|                                                    | Total operating income (loss) after corporation allocation |                                                           |         | 16,003  | )       |         |         | (1,785  | )     |         |         | 5,474  |             |         |        | (1,976 | )            |     |          | 5,894    |       |          |           | 23,610  |       
|Discontinued operations loss/(gain)                 |                                                            |                                                           |        |         |         |         | 1,664   |         |       |         |        |        |             |         |       |        |              |     | (5,315   | )        |       |          | (3,651    | )      
|                                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |    
|                                                    | Operating income (loss) from continuing operations         |                                                           | $       | 16,003  |         |         | $       | (121    | )     |         | $       | 5,474  |             |         | $      | (1,976 | )            |     | $        | 579      |       |          | $         | 19,959  |       
|                                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |    
|Interest expense                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |     |          |          |       |          | (36,308   | )      
|Amortization and write-offs of financing costs      |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |     |          |          |       |          | (3,256    | )      
|Interest and investment income                      |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |     |          |          |       |          | 431       |        
|                                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |    
|Loss from continuing operations before income taxes |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |     |          |          |       | $        | (19,174   | )      
|                                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |    
|Depreciation and amortization:                      |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |     |          |          |       |          |           |        
|                                                    | Four Corners operations                                    |                                                           | $       | 16,759  |         |         |         |         |       |         |         |        |             |         |        |        |              |     |          |          |       |          |           |         |       
|                                                    | Yorktown operations(1)                                     |                                                           |         | 4,493   |         |         |         |         |       |         |         |        |             |         |        |        |              |     |          |          |       |          |           |         |       
|                                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |    
|                                                    |                                                            |                                                           |         | Total   |         | $       | 21,252  |         |       | $       | 12,540  |        |             | $       | 2,046  |        |              | $   | 1,296    |          |       | $        |          |         |        | $         | 37,134 | 
|                                                    | Less discontinued operations                               |                                                           |         |        |         |         |         | (1,959  | )     |         |         |       |             |         |        |       |              |     |          |         |       |          |           | (1,959  | )     
|                                                    |                                                            |                                                           |         |         |         |         |         |         |       |         |         |        |             |         |        |        |              |    
|                                                    | Continuing operations                                      |                                                           | $       | 21,252  |         |         | $       | 10,581  |       |         | $       | 2,046  |             |         | $      | 1,296  |              |     | $        |         |       |          | $         | 35,175  |       
|Total assets                                        |                                                            | $                                                         | 432,655 |         |         | $       | 132,397 |         |       | $       | 66,274  |        |             | $       | 70,960 |        |              | $   |         |          |       | $        | 702,286   |        
|Capital expenditures                                |                                                            | $                                                         | 9,573   |         |         | $       | 1,016   |         |       | $       | 545     |        |             | $       | 1,856  |        |              | $   |         |          |       | $        | 12,990    |        
|Yorktown refinery acquisition                       |                                                            | $                                                         | 194,733 |         |         | $       |        |         |       | $       |        |        |             | $       |       |        |              | $   |         |          |       | $        | 194,733   |        






|    |                                   
|--- | ----------------------------------
|(1) | Since acquisition on May 14, 2002.

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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


Note 17  Commitments and Contingencies:










| |                                      
| | -------------------------------------
| | Environmental and Litigation Accruals



Summary of Accrued Environmental Contingencies


|                                      |        |                |       |       |            |   |     |          |  |       |          |        |          |            |       |       |          |       |     |          |  |   |        |        |   |   |       |       | 
|------------------------------------- | ------ | -------------- | ----- | ----- | ---------- | - | --- | -------- |  | ----- | -------- | ------ | -------- | ---------- | ----- | ----- | -------- | ----- | --- | -------- |  | - | ------ | ------ | - | - | ----- | ----- | 
|                                      |        | As of          |       |       | Increase   |   |     |          |  | As of |          |        | Increase |            |       |       |          | As of |    
|                                      |        | 12/31/02       |       |       | (Decrease) |   |     | Payments |  |       | 12/31/03 |        |          | (Decrease) |       |       | Payments |       |     | 12/31/04 | 
|                                      |        |                |       |       |            |   |     |          |  |       |          |        |          |            |       |       |          |       |     |          | 
|                                      |        | (In thousands) |      
|Farmington Refinery                   |        | $              | 570   |       |            | $ |    |          |  | $     |         |        |          | $          | 570   |       |          | $     |    |          |  | $ |       |        |   | $ | 570   |      
|Ciniza  Land Treatment Facility      |        |                | 189   |       |            |   |    |          |  |       | (3       | )      |          |            | 186   |       |          |       |    |          |  |   |       |        |   |   | 186   |      
|Bloomfield Tank Farm (Old Terminal)   |        |                | 89    |       |            |   |    |          |  |       | (22      | )      |          |            | 67    |       |          |       |    |          |  |   | (14    | )      |   |   | 53    |      
|Ciniza  Solid Waste Management Units |        |                | 275   |       |            |   |    |          |  |       |         |        |          |            | 275   |       |          |       |    |          |  |   | (1     | )      |   |   | 274   |      
|Bloomfield Refinery                   |        |                | 310   |       |            |   |    |          |  |       | (43      | )      |          |            | 267   |       |          |       |    |          |  |   | (16    | )      |   |   | 251   |      
|Ciniza Well Closures                  |        |                | 100   |       |            |   | 40  |          |  |       |         |        |          |            | 140   |       |          |       |    |          |  |   | (31    | )      |   |   | 109   |      
|Retail Service Stations  Various     |        |                | 119   |       |            |   | 60  |          |  |       | (33      | )      |          |            | 146   |       |          |       | 3   |          |  |   | (11    | )      |   |   | 138   |      
|East Outfall  Bloomfield             |        |                |      |       |            |   | 202 |          |  |       | (177     | )      |          |            | 25    |       |          |       |    |          |  |   | (25    | )      |   |   |      |      
|West Outfall  Bloomfield             |        |                |      |       |            |   |    |          |  |       |         |        |          |            |      |       |          |       | 150 |          |  |   | (106   | )      |   |   | 44    |      
|Yorktown Refinery                     |        |                | 6,715 |       |            |   |    |          |  |       | (799     | )      |          |            | 5,916 |       |          |       |    |          |  |   | (1,385 | )      |   |   | 4,531 |      
|                                      |        |                |       |       |            |   |     |          |  |       |          |        |          |            |       |       |          |       |     |          | 
|                                      | Totals |                | $     | 8,367 |            |   | $   | 302      |  |       | $        | (1,077 | )        |            | $     | 7,592 |          |       | $   | 153      |  |   | $      | (1,589 | ) |   | $     | 6,156 | 
|                                      |        |                |       |       |            |   |     |          |  |       |          |        |          |            |       |       |          |       |     |          | 

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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






| |   |                                                                                                                                           
| | - | ------------------------------------------------------------------------------------------------------------------------------------------
| |  | the remediation of the hydrocarbon plume that appears to extend
    no more than 1,800 feet south of our inactive Farmington
    refinery;
|
| |  | environmental obligations assumed in connection with our
    acquisitions of the Yorktown refinery and the Bloomfield
    refinery; and   
|
| |  | hydrocarbon contamination on and adjacent to the 5.5 acres
    that we own in Bloomfield, New Mexico.                                     





| |   |                                                                                                                                                                                              
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the closure of certain solid waste management units at the
    Ciniza refinery, which is being conducted in accordance with the
    refinerys Resource Conservation and Recovery Act permit;
|
| |  | closure of the Ciniza refinery land treatment facility including
    post-closure expenses;                                                                                                  
|
| |  | monitoring well closure costs at the Ciniza refinery; and                                                                                                                                    
|
| |  | amounts for smaller remediation projects.                                                                                                                                                    



| |                                   
| | ----------------------------------
| | Yorktown Environmental Liabilities





| |                        
| | -----------------------
| | Yorktown Consent Decree





| |                    
| | -------------------
| | Yorktown 1991 Order



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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)










| |                                 
| | --------------------------------
| | Claims for Reimbursement from BP





| |                            
| | ---------------------------
| | Farmington Refinery Matters



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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






| |                   
| | ------------------
| | Lee Acres Landfill













| |   |                                                                                                              
| | - | -------------------------------------------------------------------------------------------------------------
| |  | a number of entities had involvement at the site;                                                            
|
| |  | allocation of responsibility among potentially responsible
    parties has not yet been proposed or made; and
|
| |  | potentially applicable factual and legal issues have not been
    resolved.                                  





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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






| |                                              
| | ---------------------------------------------
| | Bloomfield Refinery Environmental Obligations





| |                                      
| | -------------------------------------
| | Western Outfall  Bloomfield Refinery





| |                                    
| | -----------------------------------
| | Bloomfield Tank Farm (Old Terminal)





| |                                                
| | -----------------------------------------------
| | Notices of Violation at Four Corners Refineries



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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)










| |   |                                                                                                                                                  
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------
| |  | implement controls to reduce emissions of nitrogen oxide, sulfur
    dioxide, and particulate matter from the largest emitting
    process units;
|
| |  | upgrade leak detection and repair practices;                                                                                                     
|
| |  | minimize the number and severity of flaring events; and                                                                                          
|
| |  | adopt strategies to ensure compliance with benzene waste
    requirements.                                                                       





| |               
| | --------------
| | Jet Fuel Claim



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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






| |                
| | ---------------
| | MTBE Litigation





| |                            
| | ---------------------------
| | Yorktown Power Outage Claim





| |                         
| | ------------------------
| | Ciniza Refinery Incident









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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






| |                                                
| | -----------------------------------------------
| | New Mexico Convenience Store Safety Regulations





Note 18  Related Party Transaction






Note 19  Acquisitions:








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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






Note 20  Quarterly Financial Information
(Unaudited)


|                         |                                                                 |                                       |   |         |        |  |   |         |   |  |        |         |   |  |   |         |  
|------------------------ | --------------------------------------------------------------- | ------------------------------------- | - | ------- | ------ |  | - | ------- | - |  | ------ | ------- | - |  | - | ------- | -
|                         |                                                                 | Year Ended December 31, 2004(1)       |  
|                         |                                                                 |                                       |  
|                         |                                                                 | Quarter                               |  
|                         |                                                                 |                                       |  
|                         |                                                                 | First                                 |   |         | Second |  |   | Third   |   |  | Fourth |        
|                         |                                                                 |                                       |   |         |        |  |   |         |   |  |        |        
|                         |                                                                 | (In thousands, except per share data) |  
|Continuing Operations:   |                                                                 |                                       |   |         |        |  |   |         |   |  |        |         |   |  |   |        
|                         | Net revenues                                                    |                                       | $ | 540,984 |        |  | $ | 654,273 |   |  | $      | 642,439 |   |  | $ | 674,309 |  
|                         | Cost of products sold (excluding depreciation and amortization) |                                       |   | 460,912 |        |  |   | 557,536 |   |  |        | 564,564 |   |  |   | 603,414 |  
|                         |                                                                 |                                       |   |         |        |  |   |         |   |  |        |        
|                         | Gross margin                                                    |                                       |   | 80,072  |        |  |   | 96,737  |   |  |        | 77,875  |   |  |   | 70,895  |  
|                         | Operating expenses                                              |                                       |   | 44,246  |        |  |   | 43,596  |   |  |        | 42,162  |   |  |   | 45,953  |  
|                         | Depreciation and amortization                                   |                                       |   | 9,104   |        |  |   | 9,226   |   |  |        | 9,030   |   |  |   | 9,769   |  
|                         | Selling, general and administrative expenses                    |                                       |   | 8,200   |        |  |   | 10,052  |   |  |        | 10,110  |   |  |   | 9,472   |  
|                         | (Gain) loss on the disposal/write-down of assets                |                                       |   | (4      | )      |  |   | 566     |   |  |        | (889    | ) |  |   | 488     |  
|                         | Gain from insurance settlement of fire incident                 |                                       |   |        |        |  |   |        |   |  |        | (958    | ) |  |   | (2,949  | )
|                         |                                                                 |                                       |   |         |        |  |   |         |   |  |        |        
|                         | Operating income                                                |                                       | $ | 18,526  |        |  | $ | 33,297  |   |  | $      | 18,420  |   |  | $ | 8,162   |  
|                         |                                                                 |                                       |   |         |        |  |   |         |   |  |        |        
|                         | Net earnings                                                    |                                       | $ | 4,586   |        |  | $ | 4,994   |   |  | $      | 5,969   |   |  | $ | 743     |  
|                         | Net earnings per common share  basic                           |                                       | $ | 0.52    |        |  | $ | 0.45    |   |  | $      | 0.49    |   |  | $ | 0.06    |  
|                         | Net earnings per common share  assuming dilution               |                                       | $ | 0.51    |        |  | $ | 0.44    |   |  | $      | 0.48    |   |  | $ | 0.06    |  
|Discontinued Operations: |                                                                 |                                       |   |         |        |  |   |         |   |  |        |         |   |  |   |        
|                         | Net revenues                                                    |                                       | $ | 612     |        |  | $ | 252     |   |  | $      | (11     | ) |  | $ |        |  
|                         |                                                                 |                                       |   |         |        |  |   |         |   |  |        |        
|                         | Loss from operations                                            |                                       | $ | (93     | )      |  | $ | (26     | ) |  | $      | (7      | ) |  | $ | (17     | )
|                         | Gain (loss) on disposal                                         |                                       |   | (18     | )      |  |   | 389     |   |  |        | 161     |   |  |   | (7      | )
|                         | Net (loss) gain on asset sales/write-downs                      |                                       |   |        |        |  |   | (372    | ) |  |        | (125    | ) |  |   |        |  
|                         |                                                                 |                                       |   |         |        |  |   |         |   |  |        |        
|                         | Operating earnings (loss)                                       |                                       | $ | (111    | )      |  | $ | (9      | ) |  | $      | 29      |   |  | $ | (24     | )
|                         |                                                                 |                                       |   |         |        |  |   |         |   |  |        |        
|                         | Net earnings (loss)                                             |                                       | $ | (69     | )      |  | $ | (6      | ) |  | $      | 18      |   |  | $ | (14     | )
|                         | Net earnings (loss) per common share  basic                    |                                       | $ | (0.01   | )      |  | $ |        |   |  | $      |        |   |  | $ |        |  
|                         | Net earnings (loss) per common share  assuming
    dilution    |                                       | $ | (0.01   | )      |  | $ |        |   |  | $      |        |   |  | $ |        |  






|    |                                                                                                                                                                                       
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Subsequent to the previously filed Form 10Qs, certain
    reclassifications have been made to present continuing and
    discontinued operations in accordance with
    SFAS No. 144.

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GIANT INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


|                                                     |                                                                 |                                       |   |         |        |  |   |         |   |  |        |         |   |  |   |         |  
|---------------------------------------------------- | --------------------------------------------------------------- | ------------------------------------- | - | ------- | ------ |  | - | ------- | - |  | ------ | ------- | - |  | - | ------- | -
|                                                     |                                                                 | Year Ended December 31, 2003(1)       |  
|                                                     |                                                                 |                                       |  
|                                                     |                                                                 | Quarter                               |  
|                                                     |                                                                 |                                       |  
|                                                     |                                                                 | First                                 |   |         | Second |  |   | Third   |   |  | Fourth |        
|                                                     |                                                                 |                                       |   |         |        |  |   |         |   |  |        |        
|                                                     |                                                                 | (In thousands, except per share data) |  
|Continuing Operations:                               |                                                                 |                                       |   |         |        |  |   |         |   |  |        |         |   |  |   |        
|                                                     | Net revenues                                                    |                                       | $ | 479,874 |        |  | $ | 407,834 |   |  | $      | 472,998 |   |  | $ | 448,956 |  
|                                                     | Cost of products sold (excluding depreciation and amortization) |                                       |   | 409,192 |        |  |   | 337,918 |   |  |        | 389,479 |   |  |   | 375,717 |  
|                                                     |                                                                 |                                       |   |         |        |  |   |         |   |  |        |        
|                                                     | Gross margin                                                    |                                       |   | 70,682  |        |  |   | 69,916  |   |  |        | 83,519  |   |  |   | 73,239  |  
|                                                     | Operating expenses                                              |                                       |   | 38,732  |        |  |   | 41,166  |   |  |        | 41,200  |   |  |   | 43,142  |  
|                                                     | Depreciation and amortization                                   |                                       |   | 9,071   |        |  |   | 9,376   |   |  |        | 9,329   |   |  |   | 9,111   |  
|                                                     | Selling, general and administrative expenses                    |                                       |   | 7,024   |        |  |   | 7,271   |   |  |        | 8,125   |   |  |   | 8,197   |  
|                                                     | (Gain) loss on the disposal/write-down of assets                |                                       |   | 420     |        |  |   | (187    | ) |  |        | 1,081   |   |  |   | 523     |  
|                                                     |                                                                 |                                       |   |         |        |  |   |         |   |  |        |        
|                                                     | Operating income                                                |                                       | $ | 15,435  |        |  | $ | 12,290  |   |  | $      | 23,784  |   |  | $ | 12,266  |  
|                                                     |                                                                 |                                       |   |         |        |  |   |         |   |  |        |        
|                                                     | Net earnings                                                    |                                       | $ | 2,411   |        |  | $ | 763     |   |  | $      | 7,677   |   |  | $ | 1,461   |  
|                                                     | Net earnings per common share  basic                           |                                       | $ | 0.28    |        |  | $ | 0.09    |   |  | $      | 0.87    |   |  | $ | 0.17    |  
|                                                     | Net earnings per common share  assuming dilution               |                                       | $ | 0.28    |        |  | $ | 0.09    |   |  | $      | 0.86    |   |  | $ | 0.17    |  
|Discontinued Operations:                             |                                                                 |                                       |   |         |        |  |   |         |   |  |        |         |   |  |   |        
|                                                     | Net revenues                                                    |                                       | $ | 12,738  |        |  | $ | 9,979   |   |  | $      | 2,684   |   |  | $ | 1,375   |  
|                                                     |                                                                 |                                       |   |         |        |  |   |         |   |  |        |        
|                                                     | Loss from operations                                            |                                       | $ | (278    | )      |  | $ | (176    | ) |  | $      | (49     | ) |  | $ | (174    | )
|                                                     | Gain (loss) on disposal                                         |                                       |   | 147     |        |  |   | (260    | ) |  |        | (14     | ) |  |   | 406     |  
|                                                     | Net (loss) gain on asset sales/write-downs                      |                                       |   |        |        |  |   | (76     | ) |  |        | (177    | ) |  |   | 20      |  
|                                                     |                                                                 |                                       |   |         |        |  |   |         |   |  |        |        
|                                                     | Operating earnings (loss)                                       |                                       | $ | (131    | )      |  | $ | (512    | ) |  | $      | (240    | ) |  | $ | 252     |  
|                                                     |                                                                 |                                       |   |         |        |  |   |         |   |  |        |        
|                                                     | Net earnings (loss)                                             |                                       | $ | (81     | )      |  | $ | (316    | ) |  | $      | (148    | ) |  | $ | 156     |  
|                                                     | Net earnings (loss) per common share  basic                    |                                       | $ | (0.01   | )      |  | $ | (0.04   | ) |  | $      | (0.01   | ) |  | $ | 0.01    |  
|                                                     | Net earnings (loss) per common share  assuming
    dilution    |                                       | $ | (0.01   | )      |  | $ | (0.04   | ) |  | $      | (0.01   | ) |  | $ | 0.01    |  
|Cumulative effect of change in accounting principle: |                                                                 |                                       |   |         |        |  |   |         |   |  |        |         |   |  |   |        
|                                                     | Net loss                                                        |                                       | $ | (704    | )      |  | $ |        |   |  | $      |        |   |  | $ |        |  
|                                                     | Net loss per common share  basic                               |                                       | $ | (0.08   | )      |  | $ |        |   |  | $      |        |   |  | $ |        |  
|                                                     | Net loss per common share  assuming dilution                   |                                       | $ | (0.08   | )      |  | $ |        |   |  | $      |        |   |  | $ |        |  






|    |                                                                                                                                                                                       
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Subsequent to the previously filed Form 10Qs, certain
    reclassifications have been made to present continuing and
    discontinued operations in accordance with
    SFAS No. 144.

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|        |                                                                                         
|------- | ----------------------------------------------------------------------------------------
|Item 9. | Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure








|         |                        
|-------- | -----------------------
|Item 9A. | Controls and Procedures



|    |                                                 
|--- | ------------------------------------------------
|(a) | Evaluation of Disclosure Controls and Procedures





|    |                                                    
|--- | ---------------------------------------------------
|(b) | Change in Internal Control Over Financial Reporting





|    |                                                                   
|--- | ------------------------------------------------------------------
|(c) | Management Report on Internal Control Over Financial
    Reporting





Internal Control-Integrated
Framework.




|    |                                                                                                    
|--- | ---------------------------------------------------------------------------------------------------
|(d) | Independent auditors report on our assessment of our internal
    control over financial reporting.

Report Of Independent Registered Public Accounting Firm








Internal Control-Integrated Framework




91



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Internal
Control-Integrated Framework Internal Control-Integrated Framework










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PART III









|         |                                                   
|-------- | --------------------------------------------------
|Item 10. | Directors and Executive Officers of the Registrant












|         |                       
|-------- | ----------------------
|Item 11. | Executive Compensation








|         |                                                                   
|-------- | ------------------------------------------------------------------
|Item 12. | Security Ownership of Certain Beneficial Owners and
    Management



|                                                           |  |                      |         |  |                      |                      |                         |                           |  |  |   | 
|---------------------------------------------------------- |  | -------------------- | ------- |  | -------------------- | -------------------- | ----------------------- | ------------------------- |  |  | - | 
|                                                           |  |                      |         |  |                      | Number of Securities |                        
|                                                           |  | Number of Securities |         |  |                      |                      | Remaining Available for |                          
|                                                           |  | to be Issued Upon    |         |  | Weighted-Average     |                      |                         | Future Issuance Under     | 
|                                                           |  | Exercise of          |         |  | Exercise Price of    |                      |                         | Equity Compensation Plans | 
|                                                           |  | Outstanding Options, |         |  | Outstanding Options, |                      |                         | (Excluding Securities     | 
|Plan Category                                              |  | Warrants and Rights  |         |  | Warrants and Rights  |                      |                         | Reflected in Column (a))  | 
|                                                           |  |                      |         |  |                      |                      |                         |                           | 
|                                                           |  | (a)                  |         |  | (b)                  |                      |                         | (c)                       | 
|Equity compensation plans approved by security holders     |  |                      | 524,000 |  |                      | $                    | 7.83                    |                           |  |  | * | 
|Equity compensation plans not approved by security holders |  |                      |        |  |                      |                      |                        |                           |  |  |  | 
|Total                                                      |  |                      | 524,000 |  |                      | $                    | 7.83                    |                           |  |  | * | 
|                                                           |  |                      |         |  |                      |                      |                         |                           | 






|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|* | The total number of shares available for grant is 2% of the
    total number of common shares outstanding as of the first day of
    each calendar year. Grants also are subject to a
    400,000 share annual limitation on the grant of options
    intended to qualify as incentive stock options under
    Section 422 of the Internal Revenue Code. Common shares
    available for grant in any particular calendar year that are
    not, in fact, granted in such year cannot be added to the common
    shares available for grant in any subsequent calendar year.





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|         |                                               
|-------- | ----------------------------------------------
|Item 13. | Certain Relationships and Related Transactions








|         |                                       
|-------- | --------------------------------------
|Item 14. | Principal Accountant Fees and Services






PART IV







|         |                                                                    
|-------- | -------------------------------------------------------------------
|Item 15. | Exhibits, Financial Statement Schedules and Reports on
    Form 8-K





| |                                                                                                            
| | -----------------------------------------------------------------------------------------------------------
| | (i) Report of Independent Registered Public Accounting Firm                                                
|
| | (ii) Consolidated Balance Sheets 
    December 31, 2004 and 2003                                          
|
| | (iii) Consolidated Statements of Operations 
    Years ended December 31, 2004, 2003 and 2002             
|
| | (iv) Consolidated Statements of Stockholders
    Equity  Years ended December 31, 2004, 2003 and
    2002
|
| | (v) Consolidated Statements of Cash Flows  Years
    ended December 31, 2004, 2003 and 2002               
|
| | (vi) Notes to Consolidated Financial Statements                                                            

Financial Statement Schedule.








Exhibits.




|            |    |             |  |                                                                                                                                                                                                                                                                                           
|----------- | -- | ----------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |    | Description
|            |    |            
|            | 10 | .2          |  | Giant Industries, Inc. 1998 Stock Incentive Plan. Incorporated
    by reference to Appendix H to the Joint Proxy Statement/
    Prospectus included in the Companys Registration Statement
    on Form S-4 under the Securities Act of 1933 as filed
    May 4, 1998, File No. 333-51785.
|            | 10 | .3          |  | Amendment No. 1 to 1998 Stock Incentive Plan, dated
    September 13, 2000. Incorporated by reference to
    Exhibit 10.8 to the Companys Annual Report on Form
    10-K for the fiscal year ended December 31, 2002, File No
    1-10398.                                               
|            | 10 | .4          |  | Amendment No. 2 to 1998 Stock Incentive Plan, dated
    March 27, 2002. Incorporated by reference to
    Exhibit 10.9 to the Companys Annual Report on Form
    10-K for the fiscal year ended December 31, 2002, File No
    1-10398.                                                   
|            | 10 | .5          |  | ESOP Substitute Excess Deferred Compensation Benefit Plan.
    Incorporated by reference to Exhibit 10.8 to the
    Companys Annual Report on Form 10-K for the fiscal year
    ended December 31, 1992, File No. 1-10398.                                                               

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|            |    |     |             |                                                                                                                                                                                                                                                                                
|----------- | -- | --- | ----------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |    |     | Description
|            |    |     |            
|            | 10 | .6* |             | 2005 Management Discretionary Bonus Plan.                                                                                                                                                                                                                                      
|            | 10 | .7  |             | Employment Agreement, dated as of December 12, 2003,
    between Fred L. Holliger and Giant Industries, Inc. Incorporated
    by reference to Exhibit 10.28 to the Companys Annual
    Report on Form 10-K for the fiscal year ended December 31,
    2003, File No. 1-10398. 
|            | 10 | .8  |             | Employment Agreement, dated as of December 12, 2003,
    between Morgan Gust and Giant Industries, Inc. Incorporated by
    reference to Exhibit 10.29 to the Companys Annual
    Report on Form 10-K for the fiscal year ended December 31,
    2003, File No. 1-10398.      
|            | 10 | .9  |             | Employment Agreement, dated as of December 12, 2003,
    between Mark B. Cox and Giant Industries, Inc. Incorporated by
    reference to Exhibit 10.30 to the Companys Annual
    Report on Form 10-K for the fiscal year ended December 31,
    2003, File No. 1-10398.      
|            | 10 | .10 |             | Employment Agreement, dated as of December 12, 2003,
    between Kim H. Bullerdick and Giant Industries, Inc.
    Incorporated by reference to Exhibit 10.31 to the
    Companys Annual Report on Form 10-K for the fiscal year
    ended December 31, 2003, File No. 1-10398.






|  |                
|- | ---------------
|* | Filed herewith.





| |                                                                                                                                                                                            
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i) On November 10, 2004, we filed a Form 8-K,
    dated November 9, 2004, containing a press release
    detailing our earnings for the third quarter of 2004.                            
|
| | (ii) On February 3, 2005, we filed a Form 8-K,
    dated February 3, 2005, containing a press release
    providing earnings guidance for the quarter and year ended
    December 31, 2004.
|
| | (iii) On March 15, 2005, we filed a Form 8-K,
    dated March 15, 2005, containing a press release detailing
    our earnings for the quarter and year ended December 31,
    2004.        

95



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SIGNATURES






| |                       
| | ----------------------
| | GIANT INDUSTRIES, INC.



| |     |                     
| | --- | --------------------
| | By: | /s/ FRED L. HOLLIGER

| |                            
| | ---------------------------
| |                            
| | Fred L. Holliger           
| | Chairman of the Board      
| | and Chief Executive Officer





|                                                     |  |                                                                                                 |  |                |  | 
|---------------------------------------------------- |  | ----------------------------------------------------------------------------------------------- |  | -------------- |  | 
|                                                    
|/s/ FRED L. HOLLIGERFred
    L. Holliger             |  | Chairman of the Board, Chief Executive Officer and Director                                     |  | March 16, 2005
|                                                    
|/s/ MARK B. COXMark
    B. Cox                       |  | Executive Vice President, Treasurer, Chief Financial Officer and
    Assistant Secretary        |  | March 16, 2005
|                                                    
|/s/ ROGER D. SANDEENRoger
    D. Sandeen             |  | Vice President, Chief Accounting Officer, Chief Information
    Officer and Assistant Secretary |  | March 16, 2005
|                                                    
|/s/ ANTHONY J.
    BERNITSKYAnthony
    J. Bernitsky |  | Director                                                                                        |  | March 16, 2005
|                                                    
|/s/ LARRY L. DEROINLarry
    L. DeRoin               |  | Director                                                                                        |  | March 16, 2005
|                                                    
|/s/ RICHARD T. KALEN,Richard
    T. Kalen, Jr.       |  | Director                                                                                        |  | March 16, 2005
|                                                    
|/s/ BROOKS J. KLIMLEYBrooks
    J. Klimley           |  | Director                                                                                        |  | March 16, 2005
|                                                    
|/s/ GEORGE M. RAPPORTGeorge
    M. Rapport           |  | Director                                                                                        |  | March 16, 2005
|                                                    
|/s/ DONALD M. WILKINSONDonald
    M. Wilkinson       |  | Director                                                                                        |  | March 16, 2005

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97



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SCHEDULE II


GIANT INDUSTRIES, INC. AND SUBSIDIARIES


Valuation and Qualifying Accounts


Three Years Ended December 31, 2004


Trade Receivables


|                                |  |                |     |  |            |   |     |              |  |            |        |   |  |   |     | 
|------------------------------- |  | -------------- | --- |  | ---------- | - | --- | ------------ |  | ---------- | ------ | - |  | - | --- | 
|                                |  | Balance at     |     |  | Charged to |   |     |              |  | Balance at |       
|                                |  | Beginning      |     |  | Costs and  |   |     |              |  | End of     |       
|                                |  | of Period      |     |  | Expenses   |   |     | Deduction(a) |  |            | Period |  
|                                |  |                |     |  |            |   |     |              |  |            |        |  
|                                |  | (In thousands) |    
|Year ended December 31, 2004:   |  |                |     |  |            |   |     |              |  |            |        |   |  |   |     | 
|Allowance for doubtful accounts |  | $              | 390 |  |            | $ | 167 |              |  | $          | (228   | ) |  | $ | 329 | 
|                                |  |                |     |  |            |   |     |              |  |            |        |  
|Year ended December 31, 2003:   |  |                |     |  |            |   |     |              |  |            |        |   |  |   |     | 
|Allowance for doubtful accounts |  | $              | 650 |  |            | $ | 0   |              |  | $          | (260   | ) |  | $ | 390 | 
|                                |  |                |     |  |            |   |     |              |  |            |        |  
|Year ended December 31, 2002:   |  |                |     |  |            |   |     |              |  |            |        |   |  |   |     | 
|Allowance for doubtful accounts |  | $              | 540 |  |            | $ | 517 |              |  | $          | (407   | ) |  | $ | 650 | 
|                                |  |                |     |  |            |   |     |              |  |            |        |  






|    |                                                                            
|--- | ---------------------------------------------------------------------------
|(a) | Deductions are primarily trade accounts determined to be
    uncollectible.

Related Party Note and Interest Receivable:


|                                |  |            |       |  |            |   |   |              |  |            |        |   |  |   |       | 
|------------------------------- |  | ---------- | ----- |  | ---------- | - | - | ------------ |  | ---------- | ------ | - |  | - | ----- | 
|                                |  | Balance at |       |  | Charged to |   |   |              |  | Balance at |       
|                                |  | Beginning  |       |  | Costs and  |   |   |              |  | End of     |       
|                                |  | of Period  |       |  | Expenses   |   |   | Deduction(b) |  |            | Period |  
|                                |  |            |       |  |            |   |   |              |  |            |        |  
|Year ended December 31, 2004:   |  |            |       |  |            |   |   |              |  |            |        |   |  |   |       | 
|Allowance for doubtful accounts |  | $          | 0     |  |            | $ | 0 |              |  | $          | 0      |   |  | $ | 0     | 
|                                |  |            |       |  |            |   |   |              |  |            |        |  
|Year ended December 31, 2003:   |  |            |       |  |            |   |   |              |  |            |        |   |  |   |       | 
|Allowance for doubtful accounts |  | $          | 5,409 |  |            | $ | 0 |              |  | $          | (5,409 | ) |  | $ | 0     | 
|                                |  |            |       |  |            |   |   |              |  |            |        |  
|Year ended December 31, 2002:   |  |            |       |  |            |   |   |              |  |            |        |   |  |   |       | 
|Allowance for doubtful accounts |  | $          | 5,409 |  |            | $ | 0 |              |  | $          | 0      |   |  | $ | 5,409 | 
|                                |  |            |       |  |            |   |   |              |  |            |        |  






|    |                                                                                                
|--- | -----------------------------------------------------------------------------------------------
|(b) | The related party note and interest receivable were determined
    to be uncollectible in 2003.

98



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GIANT INDUSTRIES, INC.


ANNUAL REPORT ON FORM 10-K


Year Ended December 31, 2003


INDEX TO EXHIBITS


Definitions:








|            |   |             |  |                                                                                                                                                                                                                                                                                                                                     
|----------- | - | ----------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |   | Description
|            |   |            
|            | 2 | .1          |  | Asset Purchase Agreement dated February 8, 2002, by and
    among, BP Corporation North America Inc., BP Products North
    America Inc., and Giant Industries, Inc. Incorporated by
    reference to Exhibit 2.3 to the Companys Annual
    Report on Form 10-K for the fiscal year ended December 31,
    2001, File No. 1-10398.
|            | 3 | .1          |  | Restated Certificate of Incorporation of Giant Industries, Inc.,
    a Delaware corporation. Incorporated by reference to
    Exhibit 3.1 to Amendment No. 3.                                                                                                                                                                       
|            | 3 | .2          |  | Bylaws of Giant Industries, Inc., a Delaware corporation, as
    amended September 9, 1999. Incorporated by reference to
    Exhibit 3.2 to the Companys Annual Report on Form
    10-K for the fiscal year ended December 31, 1999, File
    No. 1-10398.                                                                         
|            | 3 | .3          |  | Articles of Incorporation of Giant Industries Arizona, Inc., an
    Arizona corporation (Giant Arizona) formerly Giant
    Acquisition Corp. Incorporated by reference to Exhibit 2.1,
    Annex V to Form S-1.                                                                                                                   
|            | 3 | .4          |  | Bylaws of Giant Arizona. Incorporated by reference to
    Exhibit 2.1, Annex VI to Form S-1.                                                                                                                                                                                                                                        
|            | 3 | .5          |  | Articles of Incorporation of Ciniza Production Company.
    Incorporated by reference to Exhibit 3.7 to Form S-3.                                                                                                                                                                                                                   
|            | 3 | .6          |  | Bylaws of Ciniza Production Company. Incorporated by reference
    to Exhibit 3.8 to Form S-3.                                                                                                                                                                                                                                      
|            | 3 | .7          |  | Articles of Incorporation of Giant Stop-N-Go of New Mexico, Inc.
    Incorporated by reference to Exhibit 3.9 to Form S-3.                                                                                                                                                                                                          
|            | 3 | .8          |  | Bylaws of Giant Stop-N-Go of New Mexico, Inc. Incorporated by
    reference to Exhibit 3.10 to Form S-3.                                                                                                                                                                                                                            
|            | 3 | .9          |  | Articles of Incorporation of Giant Four Corners, Inc.
    Incorporated by reference to Exhibit 3.11 to Form S-3.                                                                                                                                                                                                                    
|            | 3 | .10         |  | Bylaws of Giant Four Corners, Inc. Incorporated by reference to
    Exhibit 3.12 to Form S-3.                                                                                                                                                                                                                                       
|            | 3 | .11         |  | Articles of Incorporation of Giant Mid-Continent, Inc.
    Incorporated by reference to Exhibit 3.13 to the
    Companys Annual Report on Form 10-K for the fiscal year
    ended December 31, 1994, File No. 1-10398.                                                                                                             
|            | 3 | .12         |  | Bylaws of Giant Mid-Continent, Inc. Incorporated by reference to
    Exhibit 3.14 to the Companys Annual Report on Form
    10-K for the fiscal year ended December 31, 1994, File
    No. 1-10398.                                                                                                                                
|            | 3 | .13         |  | Articles of Incorporation of San Juan Refining Company.
    Incorporated by reference to Exhibit 3.15 to the
    Companys Annual Report on Form 10-K for the fiscal year
    ended December 31, 1995, File No. 1-10398.                                                                                                            
|            | 3 | .14         |  | Bylaws of San Juan Refining Company. Incorporated by
    reference to Exhibit 3.16 to the Companys Annual
    Report on Form 10-K for the fiscal year ended December 31,
    1995, File No. 1-10398.                                                                                                                               

99



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|            |   |     |             |                                                                                                                                                                                                                                                                                                                                                                                                                     
|----------- | - | --- | ----------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |   |     | Description
|            |   |     |            
|            | 3 | .15 |             | Amended and Restated Articles of Incorporation of Phoenix Fuel
    Co., Inc. Incorporated by reference to Exhibit 3.15 to the
    Companys Registration Statement on Form S-4 under the
    Securities Act of 1933 as filed July 15, 2002, File
    No. 333-92386.                                                                                                                                                 
|            | 3 | .16 |             | Amended Bylaws of Phoenix Fuel Co., Inc. Incorporated by
    reference to Exhibit 3.18 to the Companys Annual
    Report on Form 10-K for the fiscal year ended December 31,
    1997, File No. 1-10398.                                                                                                                                                                                                           
|            | 3 | .17 |             | Articles of Incorporation of Giant Pipeline Company.
    Incorporated by reference to Exhibit 3.21 to the
    Companys Annual Report on Form 10-K for the fiscal year
    ended December 31, 1999, File No. 1-10398.                                                                                                                                                                                               
|            | 3 | .18 |             | Bylaws of Giant Pipeline Company. Incorporated by reference to
    Exhibit 3.22 to the Companys Annual Report on Form
    10-K for the fiscal year ended December 31, 1999, File
    No. 1-10398.                                                                                                                                                                                                                  
|            | 3 | .19 |             | Certificate of Incorporation of Giant Yorktown, Inc.
    Incorporated by reference to Exhibit 3.21 to the
    Companys Annual Report on Form 10-K for the year ended
    December 31, 2001, File No. 1-10398.                                                                                                                                                                                                      
|            | 3 | .20 |             | Bylaws of Giant Yorktown, Inc. Incorporated by reference to
    Exhibit 3.22 to the Companys Annual Report on Form
    10-K for the year ended December 31, 2001, File
    No. 1-10398.                                                                                                                                                                                                                            
|            | 3 | .21 |             | Certificate of Incorporation of Giant Yorktown Holding Company.
    Incorporated by reference to Exhibit 3.23 to the
    Companys Registration Statement on Form S-4 under the
    Securities Act of 1933 as filed July 15, 2002, File
    No. 333-92386.                                                                                                                                                          
|            | 3 | .22 |             | Bylaws of Giant Yorktown Holding Company. Incorporated by
    reference to Exhibit 3.24 to the Companys
    Registration Statement on Form S-4 under the Securities Act
    of 1933 as filed July 15, 2002, File No. 333-92386.                                                                                                                                                                                    
|            | 4 | .1  |             | Indenture, dated as of May 14, 2002, among the Company, as
    Issuer, the Subsidiary Guarantors, as guarantors, and The Bank
    of New York, as Trustee, relating to $200,000,000 of
    11% Senior Subordinated Notes 2012. Incorporated by
    reference to Exhibit 4.2 to the Companys Registration
    Statement on Form S-4 under the Securities Act of 1933 as
    filed July 15, 2002, File No. 333-92386.
|            | 4 | .2  |             | Indenture, dated as of May 3, 2004, among the Company, as
    Issuer, the Subsidiary Guarantors, as Guarantors, and The Bank
    of New York, as Trustee, providing for Issuance of Notes in
    Series. Incorporated by reference to Exhibit 4.6 to the
    Companys Quarterly Report on Form 10-Q for the fiscal
    quarter ended March 31, 2004, File No. 1-10398                                              
|            | 4 | .3  |             | Supplemental Indenture, dated as of May 3, 2004, among the
    Company, as Issuer, the Subsidiary Guarantors, as Guarantors,
    and The Bank of New York, as Trustee, relating to $150,000,000
    of 8% Senior Subordinated Notes due 2014. Incorporated by
    reference to Exhibit 4.7 to the Companys Quarterly
    Report on Form 10-Q for the fiscal quarter ended March 31,
    2004, File No. 1-10398.    
|            | 4 | .4  |             | Giant Industries, Inc. & Affiliated Companies 401(k)
    Basic Plan Document, effective October 9, 2003.
    Incorporated by reference to Exhibit 4.3 to the
    Companys Annual Report on Form 10-K for the fiscal year
    ended December 31, 2003, File No. 1-10398.                                                                                                                                            
|            | 4 | .5  |             | Giant Industries, Inc. & Affiliated Companies 401(k)
    Plan Adoption Agreement, effective June 24, 2003.
    Incorporated by reference to Exhibit 4.1 to the
    Companys Quarterly Report on Form 10-K for the quarter
    ended June 30, 2003, File No 1-10398.                                                                                                                                                
|            | 4 | .6  |             | First Amendment to Giant Industries, Inc. & Affiliated
    Companies 401(k) Plan Adoption Agreement, effective
    June 24, 2003. Incorporated by reference to
    Exhibit 4.2 to the Companys Quarterly Report on Form
    10-K for the quarter ended June 30, 2003, File No 1-10398.                                                                                                                             
|            | 4 | .7  |             | Second Amendment to Giant Industries, Inc. & Affiliated
    Companies 401(k) Plan Adoption Agreement, effective July 1,
    2003. Incorporated by reference to Exhibit 4.3 to the
    Companys Quarterly Report on Form 10-K for the quarter
    ended June 30, 2003, File No 1-10398.                                                                                                                             
|            | 4 | .8  |             | Third Amendment to Giant Industries, Inc. & Affiliated
    Companies 401(k) Plan Adoption Agreement, effective
    January 1, 2004. Incorporated by reference to
    Exhibit 4.7 to the Companys Annual Report on Form
    10-K for the fiscal year ended December 31, 2003, File
    No. 1-10398.                                                                                                                 

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##### Table of Contents



|            |    |       |             |                                                                                                                                                                                                                                                                                                                                                                                                 
|----------- | -- | ----- | ----------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |    |       | Description
|            |    |       |            
|            | 4  | .9    |             | Fourth Amendment to Giant Industries, Inc. & Affiliated
    Companies 401(k) Plan Adoption Agreement, effective
    March 1, 2004. Incorporated by reference to
    Exhibit 4.8 to the Companys Annual Report on Form
    10-K for the fiscal year ended December 31, 2003, File
    No. 1-10398.                                                                                              
|            | 10 | .1    |             | Third Amended and Restated Credit Agreement, dated July 15,
    2004, among Giant Industries, Inc., as Borrower, Bank of
    America, N.A., as Administrative Agent and as Issuing Bank, and
    the Lenders parties thereto. Incorporated by reference to
    Exhibit 10.1 to the Companys Quarterly Report on Form
    10-Q for the fiscal quarter ended June 30, 2004, File
    No. 1-10398.
|            | 10 | .2    |             | Giant Industries, Inc. 1998 Stock Incentive Plan. Incorporated
    by reference to Appendix H to the Joint Proxy Statement/
    Prospectus included in the Companys Registration Statement
    on Form S-4 under the Securities Act of 1933 as filed
    May 4, 1998, File No. 333-51785.                                                                                                      
|            | 10 | .3    |             | Amendment No. 1 to 1998 Stock Incentive Plan, dated
    September 13, 2000. Incorporated by reference to
    Exhibit 10.8 to the Companys Annual Report on Form
    10-K for the fiscal year ended December 31, 2002, File No
    1-10398.                                                                                                                                                     
|            | 10 | .4    |             | Amendment No. 2 to 1998 Stock Incentive Plan, dated
    March 27, 2002. Incorporated by reference to
    Exhibit 10.9 to the Companys Annual Report on Form
    10-K for the fiscal year ended December 31, 2002, File No
    1-10398.                                                                                                                                                         
|            | 10 | .5    |             | ESOP Substitute Excess Deferred Compensation Benefit Plan.
    Incorporated by reference to Exhibit 10.8 to the
    Companys Annual Report on Form 10-K for the fiscal year
    ended December 31, 1992, File No. 1-10398.                                                                                                                                                                     
|            | 10 | .6*   |             | 2005 Management Discretionary Bonus Plan.                                                                                                                                                                                                                                                                                                                                                       
|            | 10 | .7    |             | Employment Agreement, dated as of December 12, 2003,
    between Fred L. Holliger and Giant Industries, Inc. Incorporated
    by reference to Exhibit 10.28 to the Companys Annual
    Report on Form 10-K for the fiscal year ended December 31,
    2003, File No. 1-10398.                                                                                                                  
|            | 10 | .8    |             | Employment Agreement, dated as of December 12, 2003,
    between Morgan Gust and Giant Industries, Inc. Incorporated by
    reference to Exhibit 10.29 to the Companys Annual
    Report on Form 10-K for the fiscal year ended December 31,
    2003, File No. 1-10398.                                                                                                                       
|            | 10 | .9    |             | Employment Agreement, dated as of December 12, 2003,
    between Mark B. Cox and Giant Industries, Inc. Incorporated by
    reference to Exhibit 10.30 to the Companys Annual
    Report on Form 10-K for the fiscal year ended December 31,
    2003, File No. 1-10398.                                                                                                                       
|            | 10 | .10   |             | Employment Agreement, dated as of December 12, 2003,
    between Kim H. Bullerdick and Giant Industries, Inc.
    Incorporated by reference to Exhibit 10.31 to the
    Companys Annual Report on Form 10-K for the fiscal year
    ended December 31, 2003, File No. 1-10398.                                                                                                                 
|            | 10 | .11   |             | Consulting Agreement dated January 1, 1990, between the
    Company and Kalen and Associates. Incorporated by reference to
    Exhibit 10.66 to the Companys Annual Report on Form
    10-K for the fiscal year ended December 31, 1990, File
    No. 1-10398.                                                                                                                                 
|            | 10 | .12** |             | Crude Oil Purchase/Sale Agreement 2004-2008, effective as of
    February 9, 2004, between Giant Yorktown, Inc. and Statoil
    Marketing & Trading (US) Inc. Incorporated by reference
    to Exhibit 10.33 to the Companys Annual Report on
    Form 10-K for the fiscal year ended December 31, 2003, File
    No. 1-10398.                                                                 
|            | 14 | .1    |             | Code of Ethics. Incorporated by reference to Exhibit 14.1
    to the Companys Annual Report on Form 10-K for the fiscal
    year ended December 31, 2003, File No. 1-10398.                                                                                                                                                                                                                    
|            | 18 | .1    |             | Letter regarding change in accounting principles. Incorporated
    by reference to Exhibit 18.1 to the Companys Annual
    Report on Form 10-K for the fiscal year ended December 31,
    1990, File No. 1-10398.                                                                                                                                                                              
|            | 21 | .1*   |             | Subsidiaries of the Company.                                                                                                                                                                                                                                                                                                                                                                    
|            | 23 | .1*   |             | Consent of Deloitte & Touche LLP to incorporate report
    in previously filed Registration Statements.                                                                                                                                                                                                                                                                                         
|            | 31 | .1*   |             | Certification of Principal Executive Officer Pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                                                                                     
|            | 31 | .2*   |             | Certification of Principal Financial Officer Pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                                                                                     

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##### Table of Contents



|            |    |     |             |                                                                                                                                                               
|----------- | -- | --- | ----------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |    |     | Description
|            |    |     |            
|            | 32 | .1* |             | Certification of Principal Executive Officer Pursuant to
    18 U.S.C. Section 1350, as Adopted Pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002.
|            | 32 | .2* |             | Certification of Principal Financial Officer Pursuant to
    18 U.S.C. Section 1350, as Adopted Pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002.






| |   |                
| | - | ---------------
| | * | Filed herewith.



|   |                                                                                                                                                                                                          
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|** | Portions have been omitted pursuant to a request for
    confidential treatment filed by the Registrant with the
    Commission. The omitted portions have been filed separately with
    the Commission.

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